UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C.Washington, D.C. 20549

 

SCHEDULE 14A
(Rule 14a-101)

Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No.  )

 

Filed by the Registrant  x

Filed by a Party other than the Registrant  o

Check the appropriate box:

Intercept Pharmaceuticals, Inc.

(Name of Registrant as Specified In Itsin its Charter)

(Name of Person(s) Filing Proxy Statement, if other thanOther Than the Registrant)

Payment of Filing Fee (Check the appropriate box):

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May 1, 2017April 27, 2018

To Our Stockholders:

We are pleased to invite you to attend the 20172018 Annual Meeting of Stockholders of Intercept Pharmaceuticals, Inc., which will be held on Tuesday,Wednesday, June 27, 2017,20, 2018 at 9:00 a.m. Eastern Time,(local time), at the New York officeoffices of WilmerHaleSkadden, Arps, Slate, Meagher & Flom LLP, located at 7 World Trade Center, 250 Greenwich Street,Four Times Square, New York, NY 10007.New York 10036.

Details regarding the meeting, the business to be conducted at the meeting and information about Intercept that you should consider when you vote your shares are described in this proxy statement.

The boardBoard of directorsDirectors recommends the approval of each of Proposals 1,1A through 1J, 2 and 3 as set forth in the proxy statement.

We hope you will be able to attend the annual meeting.Annual Meeting. Whether or not you plan to attend the annual meeting or not,in person, it is important that you cast your vote either in person or by proxy.shares be represented and voted at the meeting. You may be able to vote over the internetInternet as well as by mail. After you have finished reading the proxy statement, we urge you to vote in accordance with the instructions set forth in this proxy statement.therein. We encourage you to vote by proxy so that your shares will be represented and voted at the meeting,Annual Meeting, whether or not you can attend.

Thank you for your continued support of Intercept. We look forward to seeing you at the annual meeting.Annual Meeting.

Sincerely,

 
Mark Pruzanski, M.D.
President and Chief Executive Officer

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Intercept Pharmaceuticals, Inc.INTERCEPT PHARMACEUTICALS, INC.
10 Hudson Yards, 37^thFloor 37
New York, NY 10001

May 1, 2017

NOTICE OF 2017 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 20, 2018

TIME:Dear Stockholder:

You are cordially invited to attend the 2018 Annual Meeting of Stockholders (the “Annual Meeting”) of Intercept Pharmaceuticals, Inc., a Delaware corporation (the “Company”). The Annual Meeting will be held on Wednesday, June 20, 2018 at 9:00 a.m. Eastern Time

DATE: Tuesday, June 27, 2017

PLACE: The(local time), at the offices of Skadden, Arps, Slate, Meagher & Flom LLP, located at Four Times Square, New York, office of WilmerHale LLP, 7 World Trade Center, 250 Greenwich Street, New York NY 1000710036.

PURPOSES:The purposes of the Annual Meeting are:

1A. Paolo Fundarò;		1B. Mark Pruzanski, M.D.;		1C. Srinivas Akkaraju, M.D., Ph.D.;
1D. Luca Benatti, Ph.D.;		1E. Daniel Bradbury;		1F. Keith Gottesdiener, M.D.;
1G. Nancy Miller-Rich;		1H. Gino Santini;		1I. Glenn Sblendorio; and
1J. Daniel Welch.

WHO MAY VOTE:The foregoing items of business are more fully described in the proxy statement accompanying this Notice of Annual Meeting of Stockholders.

You may vote if you were the record holder of Intercept common stock at theThe close of business on April 28, 2017. A list of23, 2018 is the record date for determining stockholders of record will be availableentitled to vote at the annual meeting and, duringAnnual Meeting. Only holders of the ten days prior to the annual meeting, at our principal executive offices located at 10 Hudson Yards, Floor 37, New York, NY 10001.

All stockholdersCompany’s Common Stock, par value $0.001 per share (the “shares”), as of record on the record date are cordially invitedentitled to attendnotice of, and to vote at, the annual meeting.Annual Meeting or any adjournments thereof.

By Order of the Board of Directors

/s/Ryan T. Sullivan
Ryan T. Sullivan
General Counsel and Secretary

New York, New York
April 27, 2018

Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting to be held on June 20, 2018. The Company’s Proxy Statement for the Annual Meeting and Annual Report on Form 10-K for the year ended December 31, 2017 are available atwww.interceptpharma.com/proxy.html.

Whether or not you plan to attend the annual meeting or not, we urge you to vote and submit your proxy via the internet or by mailAnnual Meeting in order to ensureperson, it is important that your shares arebe represented and voted at the annual meeting.Annual Meeting.You Holders of record may changesubmit a proxy via the Internet or revoke yourby completing, signing and dating the enclosed proxy at any time beforecard and returning it as promptly as possible in the enclosed envelope. Holders of record must vote in accordance with the instructions listed on the proxy card. Beneficial holders whose shares are held in the name of a bank, broker or other nominee must vote in accordance with the voting instructions provided to them by their bank, broker or other nominee. Such holders may be eligible to submit a proxy electronically.

The Company’s proxy statement is voted at the meeting.

BY ORDER OF THE BOARD OF DIRECTORS

Bryan Yoon
Corporate Secretarydated April 27, 2018, and is first being mailed to stockholders on or about April 27, 2018.

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INTERCEPT PHARMACEUTICALS, INC.
PROXY STATEMENT

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Intercept Pharmaceuticals, Inc.
10 Hudson Yards, Floor 37
New York, NY 10001INTERCEPT PHARMACEUTICALS, INC.

PROXY STATEMENT
FOR THE INTERCEPT PHARMACEUTICALS, INC.
20172018 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 27, 201720, 2018

ANNUAL MEETING MATTERS

ThisThese proxy statement, alongmaterials are provided in connection with the accompanying notice of 2017 annual meeting of stockholders, contains information about the 2017 annual meeting of stockholders of Intercept Pharmaceuticals, Inc., including any adjournments or postponements of the annual meeting. We are holding the annual meeting at 9:00 a.m., Eastern Time, on Tuesday, June 27, 2017, at the New York office of WilmerHale LLP, located at 7 World Trade Center, 250 Greenwich Street, New York, NY 10007.

In this proxy statement, we refer to Intercept Pharmaceuticals, Inc. as “Intercept,” “the Company,” “we” and “us.”

This proxy statement relates to the solicitation of proxies by our boardthe Board of directorsDirectors (the “Board”) of Intercept Pharmaceuticals, Inc. (the “Company”) for usethe Company’s 2018 Annual Meeting of Stockholders (the “Annual Meeting”) to be held on Wednesday, June 20, 2018 at 9:00 a.m. (local time), at the annual meeting.offices of Skadden, Arps, Slate, Meagher & Flom LLP, located at Four Times Square, New York, New York 10036.

OnUnless otherwise noted or about May 5, 2017, we began sendingthe context otherwise requires, references in this proxy statement to “we,” “us” or “our” refer to Intercept Pharmaceuticals, Inc.

General Information About the attachedAnnual Meeting and Voting

General

This proxy statement contains information about the Annual Meeting and was prepared by our management for the Board. This proxy statement and the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 (the “Annual Report”) are first being mailed to stockholders on or around April 27, 2018. This proxy statement and the Annual Report are available atwww.interceptpharma.com/proxy.html.

Purpose of the Annual Meeting

The specific proposals to be considered and acted upon at the Annual Meeting are summarized in the accompanying Notice of Annual Meeting of Stockholders andStockholders. Each proposal is described in more detail in this proxy statement.

Who can vote?

The close of business on April 23, 2018 is the enclosed proxy card to allrecord date for determining stockholders entitled to vote at the annual meeting.Annual Meeting. Only holders of the Company’s Common Stock, par value $0.001 per share (the “shares”), as of the record date are entitled to notice of, and to vote at, the Annual Meeting or any adjournments thereof. Each such holder is entitled to one (1) vote for each share that such holder held as of the record date.

Although not partOn April 23, 2018, there were 29,582,955 of thisthe Company’s shares outstanding.

How do I vote?

Holders of Record

If on the record date, your shares were registered directly in your name with our transfer agent, VStock Transfer, LLC, then you may vote your shares in one of the following ways:

Beneficial Holders

If on the record date, your shares were held in street name through a bank, broker or other nominee, then you must vote in accordance with the voting instructions provided to you by your bank, broker or other nominee. If your shares are also sending, along with thisheld in street name, you still may be eligible to submit a proxy statement, our 2016 annual reportelectronically. Beneficial holders whose shares are held in street name and who plan to vote at the Annual Meeting must obtain a legal proxy, executed in their favor by or on Form 10-K, which includes our financial statementsbehalf of their bank, broker or other nominee, to be able to vote at the Annual Meeting, and should contact such bank, broker or other nominee for the fiscal year ended December 31, 2016.instructions on how to obtain a legal proxy.

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IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE STOCKHOLDER MEETING TO BE HELD ON JUNE 27, 2017

What am I being asked to vote on?

ThisThere are three matters scheduled to be voted on at the Annual Meeting:

Will any other matters be voted on at the Annual Meeting?

As of the date of this proxy statement, the Company’s management knows of no other matter that will be presented for consideration at the Annual Meeting other than those matters discussed in this proxy statement. If any other matters properly come before the Annual Meeting and our 2016 annual report on Form 10-K are availablecall for viewing, printing and downloading athttp://www.interceptpharma.com/proxy.html. On this website, record holders can also electa vote of stockholders, proxies properly submitted prior to receive future distributionsthe Annual Meeting will be voted in accordance with the judgment of ourthe proxy statements and annual reports to stockholders by electronic delivery.holders.

Additionally, you can find a copy of our annual report on Form 10-K, which includes our financial statements, for

How does the fiscal year ended December 31, 2016Board recommend that I vote on the website of the Securities and Exchange Commission, or the SEC, atwww.sec.gov, or in the “Financial Information” section of the “Investors” section of our website atwww.interceptpharma.com.You may also obtain a printed copy of our annual report on Form 10-K, including our financial statements, free of charge, from us by sending a written request to: Intercept Pharmaceuticals, Inc., 10 Hudson Yards, Floor 37, New York, NY 10001, Attn: Corporate Secretary. Exhibits will be provided upon written request and payment of an appropriate processing fee.proposals?

The Board recommends that you vote your shares as follows:

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IMPORTANT INFORMATION ABOUT THE ANNUAL MEETING AND VOTING

Why

2.

FOR the approval, on a non-binding, advisory basis, of the compensation of the Company’s named executive officers (Proposal No. 2); and

3.

FOR the ratification of the appointment of KPMG LLP as the independent registered public accounting firm of the Company for the year ending December 31, 2018 (Proposal No. 3).

How can I vote on each proposal?

For Proposal Nos. 1A, 1B, 1C, 1D, 1E, 1F, 1G, 1H, 1I and 1J you may vote FOR or WITHHOLD your vote. For Proposal Nos. 2 and 3, you may vote FOR or AGAINST or ABSTAIN.

How do I attend the Annual Meeting?

Attendance at the Annual Meeting is limited to our stockholders as of the record date. If you plan to attend the Annual Meeting in person, you will need to register in advance and present a valid government-issued photo identification (e.g., driver’s license or passport) to be admitted. Holders of record can register for the Annual Meeting by checking the appropriate box on their proxy card. Beneficial holders whose shares are held in “street name” through a bank, broker or other nominee will need to bring a letter from their bank, broker or other nominee that confirms that such holder is the Company Soliciting My Proxy?

The boardbeneficial owner of directorssuch shares as of Intercept is soliciting your proxythe record date. Beneficial holders whose shares are held in street name and who plan to vote at the 2017 annual meetingAnnual Meeting must also obtain a legal proxy, executed in their favor by or on behalf of stockholderstheir bank, broker or other nominee, to be held at the New York office of WilmerHale LLP, located at 7 World Trade Center, 250 Greenwich Street, New York, NY 10007, on Tuesday, June 27, 2017, at 9:00 a.m. Eastern Time and any adjournments of the meeting, which we refer to as the annual meeting. The proxy statement along with the accompanying Notice of Annual Meeting of Stockholders summarizes the purposes of the meeting and the information you need to knowable to vote at the annual meeting.Annual Meeting, and should contact such bank, broker or other nominee for instructions on how to obtain a legal proxy. Holders of record will be verified against an official list. We reserve the right to deny admittance to anyone who cannot adequately show proof of share ownership as of the record date.

WeIt is important that your shares be represented and voted at the Annual Meeting and, whether or not you plan to attend the Annual Meeting in person, we encourage you to submit a proxy over the Internet or by completing and returning the proxy card. You do not need to attend the Annual Meeting in order to vote.

What vote is required to approve each proposal?

Abstentions may be specified for Proposal Nos. 2 and 3 and have made available to youno effect on the internet orresults of the relevant vote. Broker non-votes have sent you this proxy statement,no effect on the Noticeresults of the relevant vote.

What is the quorum requirement?

A “quorum” must be present for the Annual Meeting to be held. A quorum will be present if the holders of Stockholders, the proxy card and a copy of our annual report on Form 10-K for the fiscal year ended December 31, 2016 because you owned shares of Intercept common stock on the record date. The Company intends to commence distributionmajority of the proxy materials to stockholders on or about May 5, 2017.

Who Can Vote?

Only stockholders who owned our common stock atvoting power of all of the close of business on April 28, 2017 areshares entitled to vote at the annual meeting. On this record date, there were 25,009,178Annual Meeting are present in person or represented by proxy at the Annual Meeting. Shares present in person or represented by proxy at the Annual Meeting, including broker non-votes and shares of our common stock outstanding and entitled to vote. Our common stock is our only class of voting stock.

How Many Votes Do I Have?

Each share of our common stock that you own entitles youabstain or do not vote with respect to one vote.

How Do I Vote?

Whether you plan to attendor more of the annual meeting or not, we urge you to vote by proxy. All shares represented by valid proxies that we receive through this solicitation, and that are not revoked,matters presented for stockholder approval, will be voted in accordance with your instructions oncounted for purposes of determining whether a quorum is present. If there is no quorum, the proxy card or as instructed viaAnnual Meeting may be adjourned, from time to time, by the internet. If you properly submit a proxy without giving specific voting instructions, yourchairman of the Annual Meeting.

Will my shares will be voted in accordance with the board’s recommendations as noted below. Voting by proxy willif I do not affect your right to attend the annual meeting. For instructions on how to change or revoke your proxy, see “May I Change or Revoke My Proxy?” below. provide a proxy?

If your shares are registered directly in your name throughwith our stock transfer agent, VStock Transfer, LLC, or if you have stock certificates registered in your name, you may vote by any of the following methods:

Internet voting facilities for stockholders of record will be available 24 hours a day and will close at 11:59 p.m. Eastern Time on June 26, 2017.

If your shares are held in “street name” (held in the name of a bank, broker or other holder of record), you will receive instructions from the holder of record. You must follow the instructions of the holder of record in order for your shares to be voted. Internet voting also will be offered to stockholders owning shares through certain banks and brokers. If your shares are not registered in your own name and you plan to vote your shares in person at the annual meeting, you should contact your broker or agent to obtain a legal proxy or broker’s proxy card and bring it to the annual meeting in order to vote.

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TheProposal No. 3 is considered a “routine” matter for which these entities may vote unvoted shares. Proposal Nos. 1A, 1B, 1C, 1D, 1E, 1F, 1G, 1H, 1I, 1J and 2 are not considered “routine” matters for which these entities may vote unvoted shares.

Accordingly, if you hold your shares in street name, the bank, broker or other nominee through which the shares are held is not permitted to vote your shares with respect to the election of directors (Proposal 1) andor the approval, on a non-binding, advisory vote onbasis, of the compensation of the Company’s named executive compensation, or “say-on-pay” vote (Proposal 2), are both “non-discretionary” items, meaning thatofficers if you have not provided instructions. This is called a “broker non-vote.” We strongly encourage you to submit your proxy and exercise your right to vote as a stockholder.

What if I return a proxy card or otherwise submit a proxy but do not instruct your brokerage firmmake specific choices?

If you return a signed and dated proxy card or otherwise submit a proxy without voting on how to vote with respect to any of these proposals, your brokerage firm will not vote with respect to thata proposal, and your shares will be countedvoted on such proposal in the manner set forth below:

May I revoke my proxy?

If you are a holder of record, you may revoke your proxy before it is voted at the Annual Meeting by:

If youryou are a beneficial holder whose shares are held in street name, and you do not providemay submit new voting instructions toby contacting the bank, broker or other nominee that holdsthrough which you hold your shares as described above, the bank, broker or other nominee that holds your shares has the authority to vote your unvoted shares only on the ratification of the appointment of our independent registered public accounting firm (Proposal 3) without receiving instructions from you, because this is considered a “discretionary” item.

For any proposals requiring the affirmative vote of those shares present and entitled to vote, broker non-votes will not affect the outcome of the vote.

Therefore, we encourage you to provide voting instructions to your bank, broker or other designee. This ensures your shares will be voted at the annual meeting and in the manner you desire.

What Vote is Required to Approve Each Proposal and How are Votes Counted?

Proposal 1:  Elect Directors		The nominees for director who receive the most votes (also known as a “plurality” of the votes cast) will be elected.shares. You may vote FOR all of the nominees, to WITHHOLD your vote from all of the nominees or to WITHHOLD your vote from any one or more of the nominees. Votes that are withheld will not be included in the vote tally for the election of the directors.
Proposal 2:  Advisory Vote to Approve Executive Compensation, or “Say-on-Pay”		The affirmative vote of a majority of the shares cast affirmatively or negatively for this proposal is required to approve, on an advisory basis, the compensation of our named executive officers, as described in this proxy statement. Abstentions will have no effect on the results of this vote. Although the advisory vote is non-binding, the compensation committee and the board of directors will review the voting results and take them into consideration when making future decisions regarding executive compensation.
Proposal 3:  Ratify Appointment of Independent Registered Public Accounting Firm		The affirmative vote of a majority of the shares cast affirmatively or negatively for this proposal is required to ratify the selection of our independent registered public accounting firm. Abstentions will have no effect on the results of this vote. Brokerage firms have authority to vote customers’ unvoted shares held by the firms in street name on this proposal. If a broker does not exercise this authority, such broker non-votes will have no effect on the results of this vote. We are not required to obtain the approval of our stockholders to select our independent registered public accounting firm. However, if our stockholders do not ratify the appointment of KPMG LLP as our independent registered public accounting firm for 2017, our audit committee of our board of directors will reconsider its appointment.

Is Voting Confidential?

We will keep all the proxies, ballots and voting tabulations private. We only let our Inspector of Election, VStock Transfer, LLC, examine these documents. Management will not know how you voted on a specific proposal unless it is necessary to meet legal requirements. We will, however, forward to management any written comments you provide on the proxy card or through other means.

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Where

also vote in person at the Annual Meeting if you obtain a legal proxy, executed in your favor by or on behalf of your bank, broker or other nominee, as described elsewhere in this proxy statement.

Who is making and paying for this proxy solicitation?

This proxy is solicited on behalf of the Board. The Company will pay the cost of distributing this proxy statement and related materials. Upon request, the Company will reimburse banks, brokers and other nominees for reasonable expenses they incur in forwarding proxy materials to beneficial owners of the Company’s shares. The Company has retained Innisfree M&A Incorporated to assist in the solicitation of proxies for a fee of approximately $17,500, plus out-of-pocket expenses. Certain of the Company’s directors, officers and employees may participate in the solicitation of proxies, including electronically or by mail or telephone, without additional compensation.

What does it mean if I receive more than one set of proxy materials?

If you receive more than one set of proxy materials, your shares may be registered in more than one name or in different accounts. Please submit proxies for all of your shares.

I share an address with another stockholder and we received only one Annual Report and one proxy statement. How may I obtain an additional copy of the Annual Report and proxy statement?

We have adopted a procedure called “householding” under which only one Annual Report and one proxy statement will be mailed to multiple stockholders sharing an address unless the Company receives contrary instructions from one or more of the stockholders sharing an address. If your household has received only one Annual Report and one proxy statement and you wish to receive separate copies of these documents, please follow the instructions set forth under “Householding” starting on page 57.

How can I find out the results of the voting at the Annual Meeting?

We will publish the voting results of the Annual Meeting?

The preliminary voting results will be announced at the annual meeting, and we will publish preliminary, or final results if available,Meeting in a Current Report on Form 8-K within four business days of the annual meeting. If final results are unavailable at the time we file the Form 8-K, then we will file an amended report on Form 8-K to disclose the final voting results within four business days after the final voting results are known.

What Are the Costs of Soliciting these Proxies?

We will pay all of the costs of soliciting these proxies. Our directors and employees may solicit proxies in person or by telephone, fax or email. We will pay these employees and directors no additional compensation for these services. We will ask banks, brokers and other institutions, nominees and fiduciaries to forward these proxy materials to their principals and to obtain authority to execute proxies. We will then reimburse them for their expenses.

What Constitutes a Quorum for the Annual Meeting?

The presence, in person or by proxy, of the holders of a majority of the voting power of all outstanding shares of our common stock entitled to vote at the annual meeting is necessary to constitute a quorum at the annual meeting. Votes of stockholders of record who are present at the annual meeting in person or by proxy, abstentions, and broker non-votes are counted for purposes of determining whether a quorum exists.

Attending the Annual Meeting

The annual meeting will be held at 9:00 a.m. Eastern Time on Tuesday, June 27, 2017 at the New York office of WilmerHale LLP, located at 7 World Trade Center, 250 Greenwich Street, New York, NY 10007. You need not attend the annual meeting in order to vote.

Householding of Annual Disclosure Documents

SEC rules concerning the delivery of annual disclosure documents allow us or your broker to send a single set of our proxy materials to any household at which two or more of our stockholders reside, if we or your broker believe that the stockholders are members of the same family. This practice, referred to as “householding,” benefits both you and us. It reduces the volume of duplicate information received at your household and helps to reduce our expenses. The rule applies to our annual reports, proxy statements and information statements. Once you receive notice from your broker or from us that communications to your address will be “householded,” the practice will continue until you are otherwise notified or until you revoke your consent to the practice. Stockholders who participate in householding will continue to have access to and utilize separate proxy voting instructions.

If your household received a single set of proxy materials this year, but you would prefer to receive your own copy, please contact our transfer agent, VStock Transfer, LLC, by calling their toll free number, 1-855-9VSTOCK.

If you do not wish to participate in “householding” and would like to receive your own set of Intercept’s proxy materials in future years, follow the instructions described below. Conversely, if you share an address with another Intercept stockholder and together both of you would like to receive only a single set of proxy materials, follow these instructions:

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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENTSPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This proxy statement contains forward-looking statements, including, but not limited to, statements regarding the progress, timing and results of our clinical trials, including our clinical trials for the treatment of nonalcoholic steatohepatitis (“NASH”), the safety and efficacy of our approved product, Ocaliva (obeticholic acid or “OCA”), the potential approval of OCA in indications other than primary biliary cholangitis (“PBC”), the timing and potential commercial success of OCA and any other product candidates we may develop and our strategy, future operations, future financial position, future revenue, projected costs, prospects, plans, objectives of management and expected market growth.

These statements constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “target,” “potential,” “will,” “would,” “could,” “should,” “continue” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates, and we undertake no obligation to update any forward-looking statement except as required by law. These forward-looking statements are based on estimates and assumptions by our management that, although believed to be reasonable, are inherently uncertain and subject to a number of risks. The following table sets forth certain information regardingrepresent some, but not necessarily all, of the beneficial ownershipfactors that could cause actual results to differ materially from historical results or those anticipated or predicted by our forward-looking statements: our ability to successfully commercialize Ocaliva for PBC; our ability to maintain our regulatory approval of Ocaliva for PBC in the United States, Europe, Canada, Israel and other jurisdictions in which we have or may receive marketing authorization; the initiation, timing, cost, conduct, progress and results of our common stock as of April 28, 2017, by:

Beneficial ownership is determined in accordance with the rules of the SEC and includes voting or investment power with respect to the securities. Shares of common stockproduct candidates, including OCA for NASH; conditions that may be acquiredimposed by an individual or group within 60 days of April 28, 2017, pursuant to derivative securities,regulatory authorities on our marketing approvals for our products and product candidates, such as options, warrants the need for clinical outcomes data (and not just results based on achievement of a surrogate endpoint), and any related restrictions, limitations and/or restricted stock units, are deemed towarnings contained in the label of any of our products or product candidates; any potential side effects associated with Ocaliva for PBC or our product candidates that could delay or prevent approval, require that an approved product be outstanding fortaken off the purposemarket, require the inclusion of computingsafety warnings or precautions or otherwise limit the percentage ownershipsale of such individualproduct or group, butproduct candidate; our ability to maintain our relationships with, and the performance of, third-party vendors upon whom we are not deemedsubstantially dependent, including contract research organizations for our clinical trials and our third-party suppliers and manufacturers; our ability to identify, develop and commercialize our products and product candidates; our ability to obtain and maintain intellectual property protection for our products and product candidates; our ability to successfully commercialize our product candidates, if approved; the size and growth of the markets for our products and product candidates and our ability to serve those markets; the degree of market acceptance of Ocaliva for PBC and, if approved, our product candidates, which may be outstandingaffected by the ability of patients and healthcare providers to obtain coverage or reimbursement from payors for our products and the purposeextent to which such coverage or reimbursement is provided; our ability to establish and maintain an effective sales and marketing infrastructure directly or through collaborations with third parties; competition from existing drugs or new drugs that become available; costs and outcomes relating to any securities, intellectual property, employment, product liability or other litigation; our collaborators’ election to pursue research, development and commercialization activities; our ability to attract and maintain collaborators with development, regulatory and commercialization expertise; our need for and ability to obtain additional financing; our estimates regarding expenses, revenues and capital requirements and the accuracy thereof; our use of computingcash and short-term investments; our ability to acquire, license and invest in businesses, technologies, product candidates and products; our ability to attract and retain key personnel to manage our business effectively; our ability to manage the percentage ownershipgrowth of anyour operations, infrastructure, personnel, systems and controls; our ability to obtain and maintain adequate insurance coverage; and the other person shownrisks and uncertainties identified in our periodic filings filed with the table. Percentage of ownership is based on an aggregate of 25,009,178 shares of common stock outstanding as of April 28, 2017.

Except as indicated in footnotes to this table, we believe that the stockholders named in this table have sole votingU.S. Securities and investment power with respect to all shares of common stock shown to be beneficially owned by them, based on information provided to us by such stockholders. Unless otherwise indicated, the address for each director, director nominee and executive officer is: c/o Intercept Pharmaceuticals, Inc.Exchange Commission (the “SEC”), 10 Hudson Yards, Floor 37, New York, NY 10001.including our Annual Report.

Beneficial Owner		Number of Shares of Common Stock Beneficially Owned				Percentage of Common Stock Beneficially Owned
Directors, Director Nominees and Executive Officers
Mark Pruzanski, M.D.(1)			851,744				3.4	%
David Shapiro, M.D.(2)			92,989					*
Sandip Kapadia(3)			22,000					*
Rachel McMinn, Ph.D.(4)			35,041					*
Lisa Bright(5)			46,692					*
Srinivas Akkaraju, M.D., Ph.D.(6)			21,348					*
Luca Benatti, Ph.D.(7)			7,045					*
Daniel Bradbury(8)			3,473					*
Paolo Fundaro(9)			22,427					*
Keith Gottesdiener, M.D.(10)			3,473					*
Gino Santini(11)			6,435					*
Glenn Sblendorio(12)			6,205					*
Daniel Welch(13)			6,435					*
All current executive officers and directors as a group (15 persons)(14)			1,146,147				4.5	%
Barbara Duncan(15)			107,939					*
Five Percent Stockholders
Genextra S.p.A.(16)			6,454,953				25.7	%
FMR LLC(17)			3,721,316				14.8	%
Carmignac Gestion(18)			2,022,792				8.1	%
Capital World Investors(19)			2,142,459				8.5	%
Ameriprise Financial, Inc.(20)			2,507,900				10.0	%

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MANAGEMENTPROPOSALS UNDER VOTE

PROPOSAL NOS. 1A, 1B, 1C, 1D, 1E, 1F, 1G, 1H, 1I AND CORPORATE GOVERNANCE1J:

ELECTION OF DIRECTORS

The Board currently consists of Directors

Eachten directors, each of ourwhom is standing for election at the Annual Meeting. Our directors are elected annually to serve one-year terms.

The following table sets forth the names, ages, tenures and hold office until their successors are duly elected and qualified or until the earlier of their death, resignation or removal. Our board of directors currently consists of nine members, all of whom were elected as directors at our 2016 annual meeting of stockholders.

Our restated certificate of incorporation and our restated bylaws provide that the authorized number of directors may be changed only by resolution of the board of directors. Our restated bylaws also provide that our directors may be removed with or without cause by the affirmative vote of the holders of a majority of the votes that all our stockholders would be entitled to cast in an annual election of directors, and our restated certificate of incorporation and amended and restated bylaws provide that any vacancy on our board of directors, including a vacancy resulting from an increase in the size of our board, may be filled only by vote of a majoritycommittee memberships of our directors then in office.

Eachas of the nominees listed below has been nominated by the board, upon the recommendation of the nominating and governance committee, for re-election as a director until the Annual Meeting of Stockholders to be held in 2018 and until their respective successors are elected, or until their earlier death, resignation or removal. Each of the nominees presently serves on the board.

Set forth below are the names of the persons nominated as directors, their ages, their offices in the Company, if any, their principal occupations or employment for at least the past five years, the length of their tenure as directors and the names of other public companies in which such persons hold or have held directorships during the past five years. Additionally, information about the specific experience, qualifications, attributes or skills that led to our board of directors’ conclusion at the time of filing of this proxy statement that each person listed below should serve as a director is set forth below:April 27, 2018.

Name		Age		Position(s) with the Company
Paolo Fundaro		43		Chairman of the Board
Mark Pruzanski, M.D.		49		President, Chief Executive Officer and Director
Srinivas Akkaraju, M.D., Ph.D.(2)(4)		49		Director
Luca Benatti, Ph.D.(3)(4)		56		Director
Daniel Bradbury(1)(3)		56		Director
Keith Gottesdiener, M.D.(4)		63		Director
Gino Santini(1)(2)		60		Director
Glenn Sblendorio(1)		61		Director
Daniel Welch(2)(3)		59		Director

Director		Age				Director Since
Paolo Fundarò(1)			44				2006
Mark Pruzanski, M.D.			50				2002
Srinivas Akkaraju, M.D., Ph.D.(2)(3)			50				2012
Luca Benatti, Ph.D.(3)(4)			57				2014
Daniel Bradbury(4)(5)			57				2016
Keith Gottesdiener, M.D.(3)			64				2016
Nancy Miller-Rich			59				2018
Gino Santini(2)(5)(6)			61				2015
Glenn Sblendorio(5)			62				2014
Daniel Welch(2)(4)			60				2015

The Board has nominated Paolo Fundarò, Mark Pruzanski, M.D., Srinivas Akkaraju, M.D., Ph.D., Luca Benatti, Ph.D., Daniel Bradbury, Keith Gottesdiener, M.D., Nancy Miller-Rich, Gino Santini, Glenn Sblendorio and Daniel Welch for election as directors at the Annual Meeting. The election of each of the nominees recommended for election as directors requires a plurality of the votes cast in person or by proxy at the Annual Meeting. If elected, each of Messrs. Fundarò, Bradbury, Santini, Sblendorio and Welch, Drs. Pruzanski, Akkaraju, Benatti and Gottesdiener and Ms. Miller-Rich will serve on the Board until the 2019 Annual Meeting of Stockholders or until his or her respective successor is duly elected and qualified. If any of Messrs. Fundarò, Bradbury, Santini, Sblendorio or Welch, Drs. Pruzanski, Akkaraju, Benatti or Gottesdiener or Ms. Miller-Rich should become unable to accept election, the persons named as proxies may vote for a substitute nominee selected by the Board or the named proxies. Each of Messrs. Fundarò, Bradbury, Santini, Sblendorio and Welch, Drs. Pruzanski, Akkaraju, Benatti and Gottesdiener and Ms. Miller-Rich has agreed to serve if elected, and the Company’s management has no reason to believe that any nominee will be unable to serve.

The name, principal occupation and other information concerning the nominees recommended for election as directors at the Annual Meeting, including the specific experience, qualifications, attributes and skills that led the Board to determine that the nominees should serve as directors, are set forth below. There are no family relationships between or among any of our directors or executive officers. For more information regarding the independence of our directors, please see “Board of Directors and Governance—Independence.”

Paolo FundaroFundarò has served as a member of our board of directorsBoard since 2006 and has acted as our chairmanChairman since October 2015. Mr. FundaroFundarò has been Genextra’s chief financial officerChief Financial Officer of Genextra S.p.A., an investment firm focused on the life sciences industry, since its inception in 2004. Mr. Fundarò also has served as Managing Director of certain of Genextra’s portfolio companies, including Congenia S.r.l. since 2004 and Dac S.r.l. from 2004 until

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December 2016. Before joining Genextra, Mr. FundaroFundarò was directorDirector of financeFinance and strategic planningStrategic Planning for the Fastweb Group from 2000 to 2004. Previously, heEarlier in his career, Mr. Fundarò worked for investment banks including Salomon Smith Barney (now Citigroup) and Donaldson, Lufkin & Jenrette (now Credit Suisse). Mr. Fundaro hasFundarò serves on the board of directors of a number of private companies. Mr. Fundarò received a degree in Business Management from Bocconi University in Milan, Italy.

We believe that Mr. Fundaro possesses specific attributes that qualify him to serve as a member of our board of directors, including hisFundarò’s significant experience in corporate finance and strategic planning, as well as his experienceexpertise in building, investing in and growing companies in diverse industries, including the biopharmaceutical industry.

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S.p.A., a publicly traded biopharmaceutical company listed on the Swiss Exchange.that Dr. Benatti co-founded. Under his guidance,Dr. Benatti’s leadership, Newron developed a pipeline of potential therapies, with its most advanced compound, Xadago, approved in Europe and recently approved in the United States for the treatment of Parkinson’s disease. He also was instrumentaldisease in finalizing multimillion licensing deals with Merck Serono, Meiji Seikavarious jurisdictions, and Zambon Pharma S.p.A., and in the acquisition of Hunter Fleming, a U.K.-based biotechnology company.undertook significant business development activities. From 1985 to 1998, heDr. Benatti held various R&Dresearch and development positions at Farmitalia, Pharmacia and Pharmacia & Upjohn.Upjohn and its predecessor companies. Dr. Benatti has authored several scientific publications and holds a number of patents. Dr. Benatti currently serves as a director of Newron Pharmaceuticals S.p.A. Dr. Benatti also serves as chairman of Italian Angels for Biotech and as a member of the board of Assobiotec, the Italian association for the development of biotechnology. Dr. Benatti graduated from and performed his post-doctoral training at the Milano Genetics Institute. He serves as director on the board of Newron (SIX: NWRN), as chairman of the scientific advisory board of Zambon, as chairman of the Italian Angels for Biotech association, as a member of the board of Assobiotec, the Italian Biotech Association, and member of the jury of the European Biotechnica Award. He has authored several scientific publications and holds a number of patents.

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laboratory of Dr. Jack Strominger at Dana Farber Cancer Institute working on the molecular immunology of the T-cell receptor. In 1986, he joined the faculty as an assistant professor at Columbia University, started an independent research laboratory with NIH RO-1 funding, focusing on gene transcription, and was Associate Clinical Professor of Medicine at the time he left to join Merck in 1995.

We believeDr. Gottesdiener’s extensive experience as a senior executive in the pharmaceutical industry, drug development and regulatory affairs expertise and research work for both medical and academic institutions, as well as his experience as a member of the board of directors of other public companies, contributed to the Board’s conclusion that Dr. Gottesdiener’s scientific background and significant experience in leading the development of numerous therapies to market, together with his leadership experience at global biopharmaceutical companies, qualify himGottesdiener should be nominated to serve on our boardan additional term as a director of directors.

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Amicus Therapeutics, Inc. since June 2006. During the prior five years, Mr. Sblendorio previously served as a director of Amicus Therapeutics, Inc., a public biopharmaceutical company. Mr. Sblendorio was previously a board member of Ophthotech Corporation through March 2016 and The Medicines Company through December 2015.Company. Mr. Sblendorio received hisa B.B.A. from Pace University and hisan M.B.A. from Fairleigh Dickinson University and is a graduate of the Harvard Business School, Advanced Management Program.University.

We believe that Mr. Sblendorio’s extensive experience in the pharmaceutical and biotechnology industries, leadership skills, operational and strategic expertise and financial expertise,knowledge, which enables him to serve as a financial expert on our Audit Committee, as well as his experience as a member of the leadershipboard of numerous life sciencesdirectors of other public companies, together with his experience as chief financial officer and board member with numerous companies, qualify himcontributed to the Board’s conclusion that Mr. Sblendorio should be nominated to serve an additional term as a memberdirector of our board of directors. In addition, Mr. Sblendorio brings expertise to our company in the areas of business operations and strategy, financial analysis and reporting, internal auditing and controls and risk management oversight.Company.

Daniel Welch has served as a member of our board of directorsBoard since November 2015. From January 2015 to February 2018, Mr. Welch has beenserved as an Executive Partner atof Sofinnova Ventures, since 2015.a venture capital firm. From September 2003 until Octoberits acquisition by Roche Holdings in September 2014, Mr. Welch was the Chairman,served as Chief Executive Officer and President of InterMune, Inc., which was listed on the Nasdaq Stock Market until the acquisition of the company by Roche. During his tenure, InterMune secured registration of Esbriet, the first medicine approved for idiopathic pulmonary fibrosis in Europe and the United States.a biotechnology company. Mr. Welch built thealso served as Chairman of InterMune development and commercial teams that delivered the successful approval and launches of Esbriet in Europe and the United States.from May 2008 to September 2014. From August 2002 to January 2003,

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PROPOSAL NO. 2:

NON-BINDING, ADVISORY VOTE ON THE COMPENSATION OF
THE COMPANY’S NAMED EXECUTIVE OFFICERS

during fiscal 2016. The board hasWe have adopted a policy underperformance-based compensation philosophy that is intended to attract, retain, reward and incentivize our executive officers to achieve our near-term corporate goals, as well as our long-term strategic objectives. In particular, our philosophy is designed to achieve the following objectives:

We urge our stockholders to read the “Compensation Discussion and Analysis” section of this proxy statement, which each memberdescribes our executive compensation philosophy and how we implemented it through our 2017 compensation program for our principal executive officer, our principal financial officer and our three other most highly compensated executive officers serving at the end of 2017 (the “named executive officers”).

Pursuant to Section 14A of the board is strongly encouraged but not requiredExchange Act, our stockholders are entitled to attend each annual meetingvote to approve, on a non-binding, advisory basis, the compensation of our named executive officers as disclosed in this proxy statement. This non-binding, advisory vote is commonly referred to as a “say-on-pay” vote.

At our 2015 Annual Meeting of Stockholders, we asked our stockholders eitherto indicate if we should hold a “say-on-pay” vote every year, every two years or every three years. Our stockholders indicated a strong preference for holding such a vote every year and, after taking this result into consideration, our Board determined to hold such a vote every year. Accordingly, we are submitting the following resolution for stockholder approval at the Annual Meeting:

“RESOLVED, that the stockholders of Intercept Pharmaceuticals, Inc. approve, on a non-binding, advisory basis, the compensation of the Company’s named executive officers as disclosed in personthe proxy statement for the 2018 Annual Meeting of Stockholders, including the Compensation Discussion and Analysis and the compensation tables and other narrative compensation disclosures.”

This vote is not intended to address any specific item of compensation, but rather the overall compensation of the Company’s named executive officers and the philosophy, programs and practices described in this proxy statement. As this is a non-binding, advisory vote, the result will not be binding on the Company, our Board or via teleconference. Sixour Compensation Committee, although our Compensation Committee will consider the outcome of our directors, including fivethe vote when evaluating the Company’s compensation philosophy, programs and practices.

Vote Required for Approval

The approval, on a non-binding, advisory basis, of our independent directors, attended our 2016 annual meetingthe compensation of stockholders eitherthe Company’s named executive officers (Proposal No. 2) requires the affirmative vote of a majority of the shares cast affirmatively or negatively in person or by teleconference, including our chairman of the boardproxy at the time, Mr. Fundaro.Annual Meeting.

Our board of directors intends to make new committee designations after our directors commence their new terms in office upon the completion of our annual meeting of stockholders.

Audit Committee.  Our audit committee met five times during fiscal 2016. This committee currently has three members: Messrs. Sblendorio (Chairman), Bradbury and Santini. Our board of directors determined that Mr. Sblendorio is an audit committee financial expert, as defined by the rules of the SEC, and satisfies the financial sophistication requirements of applicable NASDAQ rules. Our board of directors has determined that each of Messrs. Sblendorio, Bradbury and Santini is an independent director under the NASDAQ Marketplace Rules and Rule 10A-3 of the Exchange Act.

Our audit committee’s role and responsibilities are set forth in the audit committee’s written charter and include the authority to retain and terminate the services of our independent registered public accounting firm. In addition, the audit committee reviews our annual and quarterly financial statements, considers matters relating to accounting policy and internal controls and reviews the scope of annual audits.

Our audit committee is authorized to:

Our audit committee is also empowered by the board to oversee our corporate compliance program. As part of its duties, the audit committee receives periodic updates from management and/or our advisors regarding compliance matters and reviews the adequacy and effectiveness of our compliance programs. The audit committee then periodically reports its evaluations to the board.

Please also see the report of the audit committee set forth elsewhere in this proxy statement.

THE BOARD RECOMMENDS A copy of the audit committee’s written charter is publicly available in the “Investors” section of our website atwww.interceptpharma.com.

Compensation Committee.  Our compensation committee met six times during fiscal 2016. This committee currently has three members: Messrs. Santini (Chairman) and Welch and Dr. Akkaraju. All members of the compensation committee qualify as independent under the definition promulgated by The NASDAQ Stock Market and Rule 10C-1 of the Exchange Act.

VOTE “FOR”
THE APPROVAL, ON A NON-BINDING, ADVISORY BASIS,
OF THE COMPENSATION OF THE COMPANY’S NAMED EXECUTIVE OFFICERS.

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PROPOSAL NO. 3:

RATIFICATION OF APPOINTMENT OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

OurThe Audit Committee is responsible for the appointment, compensation, committee’s roleretention and responsibilities are set forth inoversight of the compensation committee’s written charter and include:

In respectits discretion, may direct the appointment of the determination of the compensation of our president and chief executive officer, the compensation committee conducts its decision-making process without the president and chief executive officer present.

Our compensation committee makes all compensation decisions regarding our executive officers.

During the first calendar quarter of each year, we evaluate each executive’s performance for the prior year. In connection with each annual review cycle, Dr. Pruzanski, our president and chief executive officer, meets with our executive officers to discuss our accomplishmentsa different independent registered public accounting firm at any time during the year andif it determines that such a change would be in the individual’s performance and contributions over the prior year. Based on these discussions, Dr. Pruzanski, with respect to each executive other than himself, prepares an evaluationbest interest of the executive’s performance. Dr. Pruzanski also prepares his own self-assessment as well as a detailed review of company performance against stated corporate goals. This process leads to a recommendation by Dr. Pruzanski to the compensation committee with respect to each executive officer as to:

These recommendations are reviewed and taken into account by the compensation committee together with the adviceRatification of the compensation committee’sappointment of KPMG LLP as the independent compensation consultant. The compensation committee then makesregistered public accounting firm of the Company for the year ending December 31, 2018 (Proposal No. 3) requires the affirmative vote of a determination regarding executive compensation based on its reviewmajority of this information.

In designing our executive compensation program, our compensation committee considers publicly available compensation data for U.S. companiesthe shares cast affirmatively or negatively in the biopharmaceutical industry to help guide its executive compensation decisionsperson or by proxy at the time of hiring and for subsequent adjustments in compensation. Our compensation committee also retained the services of Radford, an independent compensation consultant and a part of Aon Hewitt, a business unit of Aon plc, to provide it with additional comparative data on executive compensation practices in our industry and to advise it on our executive compensation program generally. For 2016, Radford provided advice and data to the compensation committee on executive and director compensation matters, including the selection of our peer group, comparative market pay levels, equity dilution and annual share utilization practices, incentive plan design and emerging market trends. Although the compensation committee considers the advice and recommendations of the compensation consultant about our executive compensation program, the compensation committee ultimately makes its own decisions about these matters.Annual Meeting.

The compensation committee regularly reviews the services provided by its outside consultant and performs an annual assessment on the independence of its compensation consultant to determine whether the compensation consultant is independent. The compensation committee conducted a specific review of its relationship with Radford in 2016, and determined that Radford is independent in providing Intercept with

THE BOARD RECOMMENDS A VOTE “FOR”
THE RATIFICATION OF THE APPOINTMENT OF KPMG LLP
AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM.

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executive and director compensation consulting services and that its work for the compensation committee did not raise any conflicts of interest, consistent with SEC rules and NASDAQ listing standards.

Our compensation committee will also review and discuss annually with management our “Compensation Discussion and Analysis” disclosure to the extent such disclosure is required by SEC rules.

A copy

BOARD OF DIRECTORS AND GOVERNANCE

Composition of the compensation committee’s written charterBoard

The Board is publicly availablecurrently comprised of ten directors. Our directors are elected annually to serve one-year terms.

Role and Meetings of the Board

The Board meets regularly to review significant developments affecting the Company and to act on matters requiring the approval of the Board. The Board held nine board meetings during the year ended December 31, 2017. During the year ended December 31, 2017, each of our incumbent directors attended at least 75%, in the “Investors” sectionaggregate, of (i) the meetings of the Board held during the period that such director served and (ii) the meetings held by the committees of the Board on which such director served during the period that such director served.

Corporate Governance

The Company maintains a corporate governance page on its website that includes key information about its Global Code of Business Conduct and charters for each of the Audit Committee, the Compensation Committee, the Nominating and Governance Committee and the Research and Development Committee of the Board. The corporate governance page can be found on our website atwww.interceptpharma.com. in the Investors & Media section under “Corporate Governance.”

Board Leadership Structure

Nominating and Governance Committee.  Our nominating and governance committee met two time during fiscal 2016. This committee currentlyMr. Fundarò has three members: Messrs. Welch (Chairman) and Bradburyserved as our Chairman since October 2015 and Dr. Benatti. All membersPruzanski has served as our President and Chief Executive Officer, and as a member of the nominating and governance committee qualifyBoard, since our inception in 2002. In February 2018, we appointed Mr. Santini to serve as independent under the definition promulgated by The NASDAQ Stock Market.Board’s Lead Independent Director.

The nominating and governance committee’s role and responsibilities are set forth in the nominating and governance committee’s written charter and include:

If a stockholder wishes to nominate a candidate for director who is not to be included in our proxy statement, it must follow the procedures described in our restated bylaws and in “Stockholder Proposals and Nominations for Director” at the end of this proxy statement.

Under our current corporate governance policies, the nominating and governance committee may consider candidates recommended by stockholders as well as from other sources such as other directors or officers, third party search firms or other appropriate sources. The process followed by our nominating and governance committee to identify and evaluate director candidates includes requests to board members and others for recommendations, meetings from time to time to evaluate biographical information and background material relating to potential candidates and interviews of selected candidates by members of the committee and our board. For all potential candidates, the nominating and governance committee may consider all factors it deems relevant, such as a candidate’s personal integrity and sound judgment, business and professional skills and experience, independence, knowledge of the industry in which we operate, possible conflicts of interest, diversity, the extent to which the candidate would fill a present need on the board, and concern for the long-term interests of the stockholders. In general, persons recommended by stockholders will be considered on the same basis as candidates from other sources. If a stockholder wishes to propose a candidate for consideration as a nominee by the nominating and governance committee under our corporate governance policies, it should submit such recommendation in writing c/o Corporate Secretary, Intercept Pharmaceuticals, Inc., 10 Hudson Yards, Floor 37, New York, NY 10001.

A copy of the nominating and governance committee’s written charter is publicly available in the “Investors” section of our website atwww.interceptpharma.com.

Research and Development Committee.  Our research and development committee met four times during fiscal 2016. This committee currently has three members: Drs. Benatti (Chairman), Akkaraju and Gottesdiener. This committee assists the board of directors in its oversight of our strategic direction and investment in research and development, technology and manufacturing activities. The research and development committee is also responsible for identifying and discussing significant emerging trends and issues in science and technology and considering their potential impact on our company.

A copy of the research and development committee’s written charter is publicly available in the “Investors” section of our website atwww.interceptpharma.com.

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from the Company’s compensation policies and programs. The Nominating and Governance Committee focuses on the management of risks associated with the organization, membership and structure of the Board and the corporate governance structure of the Company. The Research and Development Committee reviews risks associated with the Company’s research and development programs. Each committee of the Board meets and reports its findings to the Board on a regular reports directlybasis.

Independence

The Board is currently comprised of ten directors. The Board uses the standards of independence established by the SEC and Nasdaq in determining whether its members are independent. The Board has affirmatively determined that each of the Company’s current directors (other than Dr. Pruzanski) is independent under the director independence criteria established by Nasdaq. Dr. Pruzanski is not an independent director by virtue of his employment with the Company.

In addition, the Board has determined that each member of the Audit Committee, Compensation Committee and Nominating and Governance Committee meets any additional “independence” criteria established by Nasdaq or the SEC required for service on such committees.

Executive Sessions and Meetings of Independent Directors

The Board generally holds executive sessions of the independent directors following each regularly scheduled in-person meeting of the Board. Executive sessions do not include any employee directors of the Company.

Board Attendance at Annual Meetings of Stockholders

The Board has adopted a policy strongly encouraging members of the Board to attend the Company’s Annual Meetings of Stockholders. Six of the nine directors comprising the Board at the time were in attendance at the Company’s 2017 Annual Meeting of Stockholders held on June 27, 2017.

Communication with the Board

The Board has adopted a process by which stockholders may communicate with the Board. Stockholders who wish to communicate with the Board may do so by sending written communications to the following address:

Intercept Pharmaceuticals, Inc.
c/o Company Secretary
10 Hudson Yards, 37^th Floor
New York, NY 10001

Any such communication must state the number of shares owned by the stockholder making the communication. In any such communication, an interested person may also designate a particular director, or a committee of the Board, such as the Audit Committee, to which such communication should be directed. Our legal department will forward all correspondence to the Board or the particularly designated audience, except for spam, junk mail, mass mailings, job inquiries, surveys, business solicitations or advertisements or patently offensive or otherwise inappropriate or frivolous material. Our legal department may forward certain correspondence, such as product-related inquiries, elsewhere within the Company for review and possible response.

Global Code of Business Conduct

We have adopted a Global Code of Business Conduct as our “code of ethics” as defined by regulations promulgated under the Securities Act and the Exchange Act, which applies to our directors, officers and employees, including our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. The Global Code of Business Conduct is available on our website atwww.interceptpharma.com in the Investors & Media section under “Corporate Governance.” We intend to satisfy the disclosure requirement under Item 5.05 of Form 8-K regarding any future amendment to, or waiver from, a provision of the Global Code of Business Conduct that applies to our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions by posting such information on our website atwww.interceptpharma.com in the Investors & Media section under “Corporate Governance.”

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Anti-Hedging and Anti-Pledging Policy

The Company restricts its officers and employees from (i) engaging in any transactions involving options, straddles, collars or other similar risk reduction or hedging devices, (ii) using the Company’s securities to secure a margin or other loan, (iii) effecting “short sales” of the Company’s securities and (iv) trading in the Company’s securities on a short-term basis.

Policies and Procedures Dealing with the Review and Approval of Related Person Transactions

Pursuant to its written charter, the Audit Committee is responsible for reviewing and approving, prior to the Company’s entry into any such transaction, all transactions in which the Company is or will be a participant and in which any executive officer, director, beneficial owner of more than 5% of the Company’s securities or immediate family member of any of the foregoing persons, or any other person whom the Board determines may be considered to be a related person under Item 404 of Regulation S-K, has or is expected to have a direct or indirect material interest. For the above purposes, “immediate family member” means any child, stepchild, parent, stepparent, spouse, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law or sister-in-law, and any person (other than a tenant or employee) sharing the household with the executive officer, director or 5% beneficial owner.

In reviewing and approving such transactions, the Audit Committee shall obtain, or shall direct management to obtain on its behalf, all information that the Audit Committee believes to be relevant and important to a review of the transaction prior to its approval. Following receipt of the necessary information, a discussion shall be held of the relevant factors if deemed to be necessary by the Audit Committee prior to approval. If a discussion is not deemed to be necessary, approval may be given by written consent of the committee. This approval authority may also be delegated to the chairperson of the Audit Committee in some circumstances. No related person transaction shall be entered into prior to the completion of these procedures.

The Audit Committee or its chairperson, as the case may be, shall approve only those related person transactions that are determined to be in, or not inconsistent with, the best interests of the Company and its stockholders, taking into account all available facts and circumstances as the Audit Committee or the chairperson determines in good faith to be necessary in accordance with principles of Delaware law generally applicable to directors of a Delaware corporation. These facts and circumstances will typically include, but not be limited to, the commercial reasonableness of the terms, the benefit and perceived benefit, or lack thereof, to the Company, opportunity costs of alternate transactions, the materiality and character of the related person’s direct or indirect interest and the actual or apparent conflict of interest of the related person. No member of the Audit Committee shall participate in any review, consideration or approval of any related person transaction with respect to which the member or any of his or her immediate family members has an interest.

Committees of the Board

The Board has created four standing committees: an Audit Committee, a Compensation Committee, a Nominating and Governance Committee and a Research and Development Committee. In addition, special committees of the Board may be created from time to time to oversee special projects, financings and other matters.

Audit Committee

The Board has established an Audit Committee currently consisting of Messrs. Sblendorio, Bradbury and Santini. Mr. Sblendorio, who the Board has determined is an “audit committee financial expert” (as that term is defined in Item 407(d)(5) of Regulation S-K), serves as the chairman of the Audit Committee. Each member of the Audit Committee is independent under Rule 10A-3 of the Exchange Act and the applicable rules of Nasdaq.

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The Audit Committee’s primary purpose is to act on behalf of the Board in fulfilling the Board’s oversight responsibilities with respect to the Company’s corporate accounting and financial reporting practices, systems of particular risksinternal control over financial reporting and audits of financial statements, as well as the quality and integrity of the Company’s financial statements, reports and internal controls, the qualifications, independence and performance of the Company’s independent registered public accounting firm, the performance of the Company’s internal audit function and the Company’s processes for monitoring compliance with legal and regulatory requirements and the Company’s Global Code of Business Conduct. The Audit Committee’s report begins on page 54.

The Audit Committee operates under a written charter adopted by the Board, a current copy of which is available on the Company’s website atwww.interceptpharma.com in the Investors & Media section under “Corporate Governance.” The Audit Committee met five times during the year ended December 31, 2017.

Compensation Committee

The Board has established a Compensation Committee currently consisting of Messrs. Santini and Welch and Dr. Akkaraju, all of whom are independent under applicable Nasdaq rules, “non-employee directors” within our companythe meaning of Rule 16b-3 under the Exchange Act and “outside directors” within the meaning of Section 162(m) of the Internal Revenue Code (the “Code”). Mr. Santini serves as our boardthe chairperson of directors believes that fullthe Compensation Committee. The Compensation Committee’s primary purpose is to act on behalf of the Board in fulfilling the Board’s responsibilities to oversee the Company’s compensation programs, policies and open communication betweenpractices, to review and determine the compensation to be paid to the Company’s executive officers, to review, discuss with management and approve the Company’s “Compensation Discussion and Analysis” disclosures and to review and approve the committee’s report included in the Company’s annual proxy statement in accordance with applicable rules and regulations of the SEC in effect from time to time.

The Compensation Committee’s report is set forth on page 40. For a discussion of the role of management and the boarduse of compensation consultants in determining executive compensation, see “Executive Compensation—Compensation Discussion and Analysis.”

The Compensation Committee operates under a written charter adopted by the Board, a current copy of which is available on Company’s website atwww.interceptpharma.com in the Investors & Media section under “Corporate Governance.” Under its charter, the Compensation Committee may form and delegate its authority to subcommittees of the committee when it deems it appropriate and in the best interests of the Company. The Compensation Committee met six times during the year ended December 31, 2017.

Nominating and Governance Committee

The Board has established a Nominating and Governance Committee currently consisting of Messrs. Welch and Bradbury and Dr. Benatti, all of whom are independent under applicable Nasdaq rules. Mr. Welch serves as the chairperson of the Nominating and Governance Committee. The key responsibilities of the Nominating and Governance Committee are to: (i) oversee all aspects of the Company’s corporate governance functions on behalf of the Board; (ii) make recommendations to the Board regarding corporate governance issues; (iii) identify, review and evaluate candidates to serve as directors and review and evaluate incumbent directors; (iv) serve as a focal point for communication between such candidates, non-committee directors and the Company’s management; (v) recommend to the Board for selection candidates to the Board to serve as nominees for director at Annual Meetings of Stockholders; and (vi) make other recommendations to the Board regarding affairs relating to the directors. When the Board determines to seek a new member, whether to fill a vacancy or otherwise, the Nominating and Governance Committee may utilize third-party search firms and will consider recommendations from directors, management and others, including the Company’s stockholders.

The Nominating and Governance Committee has adopted a policy regarding the qualifications of directors, is essentialwhich sets forth threshold requirements for effective riskindividuals nominated to serve as directors of the Company. In general, the Nominating and Governance Committee looks for new members possessing relevant expertise to offer advice and guidance to management, and oversight.

Stockholder Communicationshaving sufficient time to devote to the affairs of the Company, having demonstrated excellence in his or her field, having the ability to exercise sound business judgment, having the commitment to promote and enhance the long-term value of the Company for its

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stockholders and possessing the highest personal and professional standards of integrity and ethical values. The Nominating and Governance Committee does not have a formal policy with respect to diversity; however, pursuant to its policy regarding the qualifications of directors, the Nominating and Governance Committee considers issues of diversity among its members in identifying and considering nominees for director, and will strive where appropriate to achieve a diverse balance of backgrounds, perspectives, experience, age, gender, ethnicity and country of citizenship on the Board and its committees. Candidates for director nominees are reviewed in the context of the foregoing standards and considerations, as well as the contributions that the candidate can be expected to make to the collective functioning of the Board based upon the totality of his or her credentials, experience and expertise, the composition of the Board at the time and other relevant circumstances, including the operating requirements of the Company and the long-term interests of stockholders. With respect to the nomination of continuing directors for re-election, the individual’s past performance as a director is also considered. The Nominating and Governance Committee periodically reviews the composition of the Board, including whether the directors, both individually and collectively, can and do provide the experience, qualifications, attributes and skills appropriate for the Company.

The Nominating and Governance Committee has adopted policies with respect to the consideration of candidates recommended by stockholders for nomination for election to the Board and the procedures for stockholders to follow in submitting such recommendations. The Nominating and Governance Committee will consider bona fide candidates recommended by stockholders in accordance with such policies. Any such recommendation must be submitted in writing to the Nominating and Governance Committee, care of Intercept Pharmaceuticals, Inc., 10 Hudson Yards, 37^th Floor, New York, NY 10001, Attention: Company Secretary, within the time frames set forth in such policies and contain the information and undertakings required by such policies. Nominees for director who are recommended by stockholders to the Nominating and Governance Committee will be evaluated in the same manner as any other nominee for director. Nominations by stockholders may also be made in the manner set forth under “Stockholders’ Proposals.”

The Nominating and Governance Committee operates under a written charter adopted by the Board, which includes the Nominating and Governance Committee’s policies regarding the qualifications of directors, the consideration of candidates recommended by stockholders for nomination for election to the Board and the procedures for stockholders to follow in submitting such recommendations. A current copy of such charter is available on Company’s website atwww.interceptpharma.com in the Investors & Media section under “Corporate Governance.” The Nominating and Governance Committee met twice during the year ended December 31, 2017.

Research and Development Committee

Generally, stockholders who have questionsThe Board has established a Research and Development Committee currently consisting of Drs. Benatti, Akkaraju and Gottesdiener, all of whom are independent under applicable Nasdaq rules. Dr. Benatti serves as the chairperson of the Research and Development Committee. The primary purposes of the Research and Development Committee are to assist the Board in its oversight of the Company’s strategic direction and investment in research and development, technology and manufacturing activities and to identify and discuss significant emerging trends and issues in science and technology and consider their potential impact on the Company.

The Research and Development Committee operates under a written charter adopted by the Board, a copy of which is available on Company’s website atwww.interceptpharma.com in the Investors & Media section under “Corporate Governance.” The Research and Development Committee met once during the year ended December 31, 2017.

Compensation Committee Interlocks and Insider Participation

During 2017, Messrs. Santini and Welch and Dr. Akkaraju comprised the Compensation Committee. No member of the Compensation Committee is or concerns should contacthas formerly been an officer or employee of the Company. In 2017, none of our Investor Relations department at 646-747-1000. However, any stockholders who wish to address questions regarding our business directly withexecutive officers served on the board of directors or any individualcompensation committee of another entity that had one or more of its executive officers serving on the Board or the Compensation Committee of the Company. Please refer to “Related Person Transactions” for information concerning certain transactions with Samsara BioCapital, L.P. Dr. Akkaraju is a managing member of Samsara BioCapital GP, LLC, the general partner of Samsara BioCapital, L.P.

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Director Compensation

On an annual basis, the Compensation Committee conducts an evaluation of the design and competitiveness of the Company’s non-employee director should direct his or her questionscompensation program in writinglight of market trends, best practices and competitive market data for the Company’s compensation peer group. In 2017, the Compensation Committee also retained the services of Radford, an independent compensation consultant and subdivision of Aon plc, to provide it with additional comparative data on director compensation practices in the Company’s industry and to advise it on the Company’s non-employee director compensation program generally. In April 2017, based on the input and analysis provided by Radford, our Compensation Committee and Board determined the Company’s 2017 non-employee director compensation program with reference to the chairman50^th percentile of the boardcompetitive market based on our compensation peer group. As a result, (i) all annual cash retainers were maintained at their 2016 levels, except for the annual cash retainer for the Chairman of the Board, which was increased from $75,000 to $80,000, (ii) the aggregate amount of the Annual Grant (as defined below) was reduced from $406,832 to $337,203 and (iii) the aggregate amount of any New Director Grant (as defined below) was reduced from $813,665 to $693,461. Only directors who are “independent” in accordance with applicable Nasdaq rules (the “Independent Directors”) receive compensation for their service as directors. Each of the Company’s current directors, other than Dr. Pruzanski, qualifies as an Independent Director.

Effective April 2017, the annual cash retainers for the Independent Directors were set as follows (payable quarterly in equal installments):

Membership		Chairperson				Other Members
Board of Directors.		$	80,000			$	50,000
Audit Committee		$	20,000			$	10,000
Compensation Committee		$	15,000			$	7,500
Nominating and Governance Committee		$	10,000			$	5,000
Research and Development Committee		$	10,000			$	5,000

Effective April 2017, (i) each Independent Director who had served on the Board for six months or any individual director ATTN: SECURITY HOLDER COMMUNICATION, Boardlonger as of Directors, Intercept Pharmaceuticals, Inc. at 10 Hudson Yards, Floor 37, New York, NY 10001the date of the Company’s Annual Meeting of Stockholders was eligible to receive an annual equity grant (each, an “Annual Grant”) comprised of $163,616 of stock options and $173,587 of restricted stock and (ii) each new Independent Director appointed or via e-mail at secretary@interceptpharma.com. Communications will be distributedelected to the board, orBoard was eligible to any individual director or directors as appropriate, dependingreceive an equity grant (each, a “New Director Grant”) comprised of $369,823 of stock options and $323,638 of restricted stock.

Subject to the Independent Director’s continued service on the factsBoard, the stock option and circumstances outlinedrestricted stock awards granted in connection with (i) each Annual Grant vest in full on the communications. Items that are unrelatedearlier of (A) the one-year anniversary of the date of grant and (B) the day immediately preceding the date of the next Annual Meeting of Stockholders and (ii) each New Director Grant vest in a series of three equal annual installments, with 1/3 of the shares subject to the duties and responsibilitiesaward vesting on each anniversary of the board may be excluded,date that the Independent Director was first elected or appointed to the Board (or, if earlier in any given year, the day immediately preceding the date of the Annual Meeting of Stockholders in such as:

year). In addition, any material thatall unvested Annual Grants and New Director Grants shall immediately vest in connection with a change of control of the Company. The exercise price for stock options granted in connection with each Annual Grant and New Director Grant is unduly hostile, threatening, or illegalthe per-share closing price of the Company’s common stock on the Nasdaq Global Select Market on the date of grant.

The Company also reimburses reasonable out-of-pocket expenses incurred in nature may be excluded, provided that any communication that is filtered out will be made available to any outside director upon request.connection with attendance at Board meetings.

Executive Officers

The following table sets forth, certainfor the fiscal year ended December 31, 2017, the total compensation paid to the Independent Directors serving on the Board during 2017.

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Director Compensation for 2017

Name		Fees Earned or Paid in Cash ($)				Stock Awards ($)(9)				Option Awards ($)(9)				Total ($)
Paolo Fundarò			78,750	(1)			173,620				141,698				394,068
Srinivas Akkaraju, M.D., Ph.D.			62,500	(2)			173,620				141,698				377,818
Luca Benatti, Ph.D.			65,000	(3)			173,620				141,698				380,318
Daniel Bradbury			65,000	(4)			173,620				141,698				380,318
Keith Gottesdiener, M.D.			55,000	(5)			173,620				141,698				370,318
Gino Santini			75,000	(6)			173,620				141,698				390,318
Glenn Sblendorio			70,000	(7)			173,620				141,698				385,318
Daniel Welch			67,500	(8)			173,620				141,698				382,818

Stock Ownership Guidelines for Directors

The Company has adopted minimum stock ownership guidelines for the Board, which require, within a five-year period, the Independent Directors to hold Company equity equal to at least 3x their annual cash retainer. Until the ownership guidelines are satisfied, the Independent Directors are required to maintain a minimum retention ratio of at least 50% of their annual equity awards, net of shares sold or withheld solely to pay applicable exercise fees and/or withholding taxes. Any Independent Directors failing to meet the guidelines within the allotted compliance period will be required to maintain a minimum retention ratio of 100% of net shares after the applicable exercise fees and/or withholding taxes.

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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table and accompanying footnotes show information as of April 23, 2018 regarding ourthe beneficial ownership of the Company’s shares by:

For purposes of the table below, we deem shares subject to options that are exercisable or exercisable within sixty days of April 23, 2018 to be outstanding and to be beneficially owned by the person holding the options for the purpose of computing the percentage ownership of that person, but we do not also directors.treat them as outstanding for the purpose of computing the percentage ownership of any other person. Except as otherwise noted, the persons or entities in this table have sole voting and investing power with respect to all of the shares beneficially owned by them. On April 23, 2018, there were 29,582,955 shares outstanding. Unless otherwise specified, the address of each director and executive officer is c/o Intercept Pharmaceuticals, Inc., 10 Hudson Yards, 37^th Floor, New York, NY 10001.

Name and Address		Shares Beneficially Owned(5)
		Number of Shares				Percentage of Common Stock
5% Stockholders:
Genextra S.p.A.(1)			6,845,578				23.1	%
FMR LLC(2)			3,765,311				12.7	%
JPMorgan Chase & Co.(3)			2,007,198				6.8	%
Directors and Executive Officers:
Paolo Fundarò			25,886					*
Mark Pruzanski, M.D.			847,355				2.8	%
Srinivas Akkaraju, M.D., Ph.D.(4)			259,182					*
Luca Benatti, Ph.D.			10,504					*
Daniel Bradbury			15,809					*
Keith Gottesdiener, M.D.			9,168					*
Nancy Miller-Rich			—					*
Gino Santini			11,061					*
Glenn Sblendorio			9,664					*
Daniel Welch			10,242					*
Jerome Durso			21,250					*
David Ford			9,250					*
Sandip Kapadia			32,948					*
David Shapiro, M.D.			97,887					*
All directors and executive officers as group (18 persons)			1,484,404				4.9	%

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EXECUTIVE OFFICERS

The executive officers of Intercept Pharmaceuticals, Inc. as of April 27, 2018, their positions and their ages are as listed below.

Name		Age				Position(s)Position
Mark Pruzanski, M.D.			50				President and Chief Executive Officer
Jerome Durso			50				Chief Operating Officer
Lisa Bright		49	50				President, International
Jerome B. DursoDavid Ford			49				Chief OperatingHuman Resources Officer
Sandip Kapadia		47	48				Chief Financial Officer and Treasurer
Richard Kim		48	49		Senior Vice President, Commercial U.S.
Rachel McMinn, Ph.D.		44President, U.S. Commercial & Strategic Marketing		Chief Business and Strategy Officer
David Shapiro, M.D.		62	63				Chief Medical Officer
Ryan Sullivan			42				General Counsel and Executive Vice President,Secretary
Christian Weyer, M.D., M.A.S.			49				EVP, Research & Development

Lisa BrightMark Pruzanski, M.D. is one of our co-founders and has served as our President Internationaland Chief Executive Officer, and as a member of our Board, since July 2016. Sheour inception in 2002. Dr. Pruzanski has over 2520 years of experience in the biopharmaceutical industry. Ms. Bright joined Intercept in November 2014 as senior vice presidentlife sciences company management, venture capital and head of Europe and then served as chief commercial and corporate affairs officer from February 2015 to July 2016.strategic consulting. Prior to joining Intercept, Ms. Bright workedco-founding the Company, Dr. Pruzanski was a venture partner at Gilead Sciences Ltd. starting in 2008, where she held positionsApple Tree Partners, an early stage life sciences venture capital firm that he co-founded, and an entrepreneur-in-residence at Oak Investment Partners, a venture capital firm. Dr. Pruzanski is a co-author of increasing responsibility, including: general manager United Kingdom & Ireland; vice president, Northern Europe; vice president, heada number of Sovaldi launch planning for Europe, Asia, Middle Eastscientific publications and Australasia; and vice president, government affairs Europe, Middle East and Australasia. Prior to holding these positions, Ms. Bright held a rangeis named as an inventor on several of senior positions at GlaxoSmithKline plc, including vice president and managing director of New Zealand and vice president — sales for the United Kingdom. Ms. Bright has been nominated to join the board of directors of Ascendis Pharma A/S, a Danish biopharmaceutical company listedour patents. Dr. Pruzanski currently serves on the NASDAQ. Ms. Bright hasboards of the Emerging Companies Section of the Biotechnology Innovation Organization (BIO), a B.Sc.biotechnology-focused trade association, and the Foundation for Defense of Democracies, a non-profit policy institute focusing on foreign policy and national security. Dr. Pruzanski received his M.D. from McMaster University in pharmacologyHamilton, Canada, a M.A. degree in International Affairs from the Johns Hopkins University College London.School of Advanced International Studies in Bologna, Italy and Washington, D.C., and a bachelor’s degree from McGill University in Montreal, Canada.

Jerome B. Durso has served as our chief operating officerChief Operating Officer since February 2017. HeMr. Durso has nearly 25 years of experience in building and leading commercial and business operations at life sciences companies both in the United States and abroad. Prior to joining the Company, Mr. Durso served as a consultant to the biopharmaceutical industry from September 2015 to February 2017. Mr. Durso has spent the majority of his career at Sanofi, a global pharmaceutical company, where he most recently served as senior vice president, chief commercial officerSenior Vice President, Chief Commercial Officer of the global diabetes divisionGlobal Diabetes Division from June 2011 throughto April 2015. From 2010 to 2011, Mr. Durso was senior vice

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David Fordhas served as our Chief Human Resources Officer since May 2017. He brings over 25 years of experience in a variety of human resources roles across the United States, Europe, Latin America and New Zealand. Prior to joining the Company, Mr. Ford spent nearly 15 years at Sanofi, where he most recently served as Vice President Human Resources for the Sanofi Genzyme global business unit from January 2016 to May 2017. Prior to that role, from November 2011 through December 2015, Mr. Ford served as Vice President Human Resources for the Sanofi North American businesses. Mr. Ford joined the pharmaceutical industry in 2002 as the HR Director — United Kingdom and Republic of Ireland for Sanofi-Synthelabo. Mr. Ford holds a master’s degree in business administration from INSEAD, Fontainebleau (France).

Sandip Kapadiahas served as our chief financial officerChief Financial Officer and treasurerTreasurer since July 2016. Mr. Kapadia has over 20 years of experience in building and leading finance and administration teams at life sciences companies both in the United States and abroad. Mr. Kapadia joined Interceptthe Company from Sandoz, Inc., a division of Novartis AG, where he served as vice presidentVice President and chief financial officerChief Financial Officer — North America from July 2014 throughto June 2016. From March 2012 to June 2014, Mr. Kapadia was vice presidentVice President and chief financial officerChief Financial Officer of Novartis Pharmaceuticals UK Limited. Mr. Kapadia also served as vice presidentVice President and chief financial officerChief Financial Officer of Novartis Pharmaceuticals B.V. located in the Netherlands from 2009 throughto 2012. Prior to that, he served as headHead of financeFinance — oncology business unitOncology Business Unit for both Novartis Pharmaceuticals A.G. and Novartis Pharmaceuticals Corporation. Mr. Kapadia earned his bachelorbachelor’s degree in business administration and accounting from Montclair State University, an M.B.A from Rutgers Graduate School of Management and is a certified public accountant.

Richard Kim has served as our senior vice president, commercialPresident, U.S. Commercial & Strategic Marketing since February 2018, having previously served as Senior Vice President, Commercial U.S. since July 2015. He has over 20 years of commercial, marketing and managerial experience in the biopharmaceutical industry in the United States and abroad. Prior to joining Intercept,the Company, Mr. Kim worked at Bristol-Myers Squibb starting in 2004, where he most recently served as general manager, hepatitisGeneral Manager, Hepatitis C worldwide commercialization.Worldwide Commercialization. Prior to that, Mr. Kim held a number of roles of increasing responsibility at Bristol-Myers Squibb, including vice president,Vice President, SPRYCEL brand lead, oncology global marketing; vice president,Brand Lead, Oncology Global Marketing; Vice President, U.S. in-line oncologyIn-Line Oncology and global marketingGlobal Marketing for necitumumab;Necitumumab; and vice president, east area sales, cardiovascularVice President, East Area Sales, Cardiovascular and metabolics.Metabolics. Prior to holding these positions, Mr. Kim held a range of senior positions in the United States, Canada and Australia at Schering-Plough, which was acquired by Merck & Co., Inc. Mr. Kim earned his bachelorbachelor’s degree in chemistry from the University of Alberta.

Rachel McMinn, Ph.D. has served as our chief business and strategy officer since March 2015. Dr. McMinn joined Intercept as chief strategy officer in 2014. Since 2009 until joining Intercept, she was a managing director at Bank of America Merrill Lynch, working as the lead research analyst covering the biotechnology industry. Previously, Dr. McMinn worked at Cowen and Company as a lead biotechnology analyst and started her career as a biotechnology analyst at Piper Jaffray & Co. She graduatedmagna cum laude with a Bachelor of Arts degree in chemistry from Cornell University, earned a Ph.D. in molecular and cellular biology and chemistry from The Scripps Research Institute, and was awarded a post-doctoral Miller fellowship at the University of California, at Berkeley.

David Shapiro, M.D. has served as our chief medical officerChief Medical Officer since November 2017, having previously served as our Chief Medical Officer and executive vice president, developmentExecutive Vice President, Development since 2008. HeDr. Shapiro has over 25 years of clinical development experience in the pharmaceutical industry. Dr. Shapiro founded a consulting company, Integrated Quality Resources, that focused on development stage biopharmaceutical companies and was active in this role from 2005 to 2008. From 2000 to 2005, Dr. Shapiro was executive vice president, medical affairsExecutive Vice President, Medical Affairs and chief medical officerChief Medical Officer of Idun Pharmaceuticals, Inc., prior to its acquisition by Pfizer.Pfizer Inc. From 1995 to 1998, he was presidentPresident of the Scripps Medical Research Center at Scripps Clinic. He also served as vice president, clinical researchVice President, Clinical Research at Gensia and as directorDirector and group leader, hypertension clinical researchGroup Leader, Hypertension Clinical Research at Merck Research Laboratories from 1985 to 1990. Dr. Shapiro has authored more than 20 peer-reviewed publications and organized and chaired several conferences aimed at improving product development. HeDr. Shapiro served for two terms on the Executive Committee of the Board of the American Academy of Pharmaceutical Physicians. Dr. Shapiro has been a director of Arcturus Therapeutics Ltd. since November 2017. Dr. Shapiro received his medical degree from Dundee University & Medical School, and undertook his postgraduate medical training in the university affiliated hospitals in Oxford, United Kingdom and the University of Vermont. Dr. Shapiro served on the board of directors of Altair Therapeutics and served for two terms on the Executive Committee of the Board of the American Academy of Pharmaceutical Physicians. He is an elected Fellow of both the Royal College of Physicians of London and the Faculty of Pharmaceutical Physicians of the United Kingdom.

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There are no family relationships between or among any ofRyan Sullivan has served as our executive officers. The principal occupationGeneral Counsel and employment duringSecretary since February 2018. Prior to joining the past five years of each of our executive officersCompany, Mr. Sullivan worked at Anacor Pharmaceuticals, Inc., which was carried on, in each case exceptacquired by Pfizer Inc. At Anacor, Mr. Sullivan served as specifically identified above, with a corporation or organization that is not a parent, subsidiary or other affiliate of us. There is no arrangement or understanding between any of our executive officersExecutive Vice President, General Counsel and any other person or persons pursuant to which he was or is to be selectedSecretary from February 2016 until June 2016 and as Senior Vice President, General Counsel and Secretary from April 2014 until February 2016. Before joining Anacor, Mr. Sullivan worked as an attorney in the legal group of Warner Chilcott plc prior to its acquisition by Actavis plc (now Allergan plc). During his tenure at Warner Chilcott from July 2007 until December 2013, Mr. Sullivan served in a number of positions of increasing responsibility, including most recently as General Counsel and Secretary. Before joining Warner Chilcott, Mr. Sullivan practiced in the New York corporate law group of Cahill Gordon & Reindel LLP. Mr. Sullivan earned his bachelor’s of science degree from Cornell University and his juris doctor degree from Cornell Law School.

Christian Weyer, M.D., M.A.S. has served as our EVP, Research & Development since November of 2017. Dr. Weyer’s career in metabolic drug development spans more than 20 years, involving clinical studies and regulatory submissions at all stages of product development and across the continuum of diabetes, obesity and NAFLD/NASH. Prior to joining the Company, Dr. Weyer was President and Chief Development Officer at ProSciento, Inc., a leading clinical R&D service provider focused on diabetes, NAFLD/NASH and obesity, from December 2015 to November 2017. Dr. Weyer has served as a senior executive officer.

There are no legal proceedingsin several companies, including as President, Chief Executive Officer and a director of Fate Therapeutics, Inc. from October 2012 to which anyNovember 2015, where he steered the company’s transition into a publicly-traded cellular therapeutics company, and as Senior Vice President of our executive officers isR&D at Amylin Pharmaceuticals, Inc., where he contributed to the development and approval of several first-in-class medicines for diabetes and lipodystrophy. Before joining Amylin, Dr. Weyer worked at the National Institutes of Health, NIDDK, conducting clinical research on the pathogenesis of obesity and type 2 diabetes. Dr. Weyer received his M.D. and clinical training at the Department of Metabolic Disorders, World Health Organization Collaborating Center for Diabetes Treatment and Prevention, at the University of Düsseldorf, Germany and holds a party adverse to us or anypostdoctoral master’s degree in advanced clinical research from the University of our subsidiaries or in which any such person has a material interest adverse to us or any of our subsidiaries.California, San Diego.

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EXECUTIVE OFFICER AND DIRECTOR COMPENSATION

Compensation Discussion and Analysis

Executive Summary

Overview

This section discusses the principles underlying our policiesCompensation Discussion and decisions with respect to the compensation ofAnalysis describes our executive officerscompensation philosophy and thehow we implemented it through our 2017 compensation program for our principal executive officer, our principal financial officer and our three other most important factors relevant to an analysis of these policies and decisions. This section also describes the material elements of compensation awarded to, earned by or paid to each of our namedhighly compensated executive officers for 2016. In addition, this section provides qualitative information regardingserving at the manner and context in which compensation is awarded to and earned by our executive officers and is intended to place in perspective the data presented in the tables and narrative that follow. Ourend of 2017 (the “named executive officers” for the year ended December 31, 2016 were as follows:):

Name		Title
Mark Pruzanski, M.D.			President and Chief Executive Officer and President
David Shapiro, M.D.(“CEO”)		Chief Medical Officer and Executive Vice President, Development
Sandip Kapadia			Chief Financial Officer and Treasurer
Jerome Durso(1)
Rachel McMinn, Ph.D.		Chief Business and StrategyOperating Officer
Lisa BrightDavid Ford(2)		President, International(2)	Chief Human Resources Officer
Barbara DuncanDavid Shapiro, M.D.(3)		Former	Chief FinancialMedical Officer and Treasurer(3)

2016 Performance Highlights

Executive Summary

In 2016, we successfully2017 was a productive year for us. We achieved multiple important corporate,a number of significant commercial and product development milestones and commercial milestones that we believe contributedcontinued to enhancing stockholder value. Success in achieving these milestones enabled us to achieve receive marketing approval forrefine and start the commercial launch of Ocaliva® (obeticholic acid or OCA) for use in primary biliary cholangitis, or PBC,strengthen our executive compensation programs and continue our development of OCA for PBC, nonalcoholic steatohepatitis, or NASH, and other indications. In particular:corporate governance practices. Highlights are described below.

KEY BUSINESS ACHIEVEMENTS

•

Recognized Significant Ocaliva Revenues in PBC:  The accelerated approval of Ocaliva for use in PBC in both the United StatesStates.  We recognized $115.8 million in May 2016 and the conditional approvalU.S. net sales of Ocaliva for use in PBC in the European Union in December 2016 allowed us to commence our commercial launches within our stated timelines.

º

United States:  Ocaliva was approved by the U.S. Food and Drug Administration, or FDA, in May 2016 for the treatment of PBC in combination with ursodeoxycholicOcaliva® (obeticholic acid or UDCA,“OCA”) in adults with an inadequate response to UDCA or as monotherapy in adults unable to tolerate UDCA. We commercially launched Ocaliva2017, its first full year of sales in the United States following its launch in June 2016, and in conjunction launched Interconnect®, a comprehensive, personalized program that connects patients with dedicated care coordinators who help them understand their disease and provides treatment support and, for eligible patients, financial assistance options. Net U.S. Ocaliva sales wereas compared to $18.2 million for the full yearin 2016.

º

Successful Launch of Ocaliva in Europe: and Canada.  Ocaliva was granted conditional approval for the treatment of primary biliary cholangitis (“PBC”) by the European Commission in December 2016 for the treatment of PBCand by Health Canada in combination with UDCA in adults with an inadequate response to UDCA or as monotherapy in adults unable to tolerate UDCA. This approvalMay 2017. These approvals allowed us to commence our European commercial launch of Ocaliva in certain European countries in January 2017 and in Canada in July 2017. As a result, we recognized $13.4 million in ex-U.S. net sales of Ocaliva in 2017.

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•

OCA Program inAdvanced NASH: Development Program.  We continued our ongoing Phase 3 clinical trial known as REGENERATE, in non-cirrhotic NASHnonalcoholic steatohepatitis (“NASH”) patients with liver fibrosis. We are targeting completion offibrosis, known as the REGENERATE trial. In May 2017, we completed enrollment of the interim analysis cohort of patients needed for the pre-specified interim analysis by mid-2017, withREGENERATE trial, and we currently expect top-line results from the interim analysis anticipated in the first half of 2019. We continuedIn addition, in July 2017, we announced that the CONTROL trial, a Phase 2 clinical trial known as the CONTROL trial,designed to characterize the lipid metabolic effects of OCA and cholesterol management effects of concomitant statin administration in NASH patients.patients met its primary endpoint. We completed enrollment of the targeted number of patients foralso continued to work towards expanding our CONTROLoverall NASH development program with additional trials and studies, including our ongoing Phase 3 trial in October 2016 and expect top-line resultsNASH patients with compensated cirrhosis, known as the REVERSE trial, which we announced in 2017.February 2018.

•

Other Product Development Achievements.  In addition to PBC and NASH, we continued to invest in research of OCA Programs:  We completed enrollmentfor additional patient populations with other liver diseases. For example, in aJuly 2017, we announced top-line results of our Phase 2 clinical trial, known as the AESOP trial to evaluatein primary sclerosing cholangitis (“PSC”), which evaluated the effects of 24 weeks of treatment with varying doses of OCA compared to placebo. This trial achieved its primary endpoint, which we believe establishes a proof-of-concept of OCA in patients with primary sclerosing cholangitis, or PSC. We also continued a Phase 2 clinical trial, referred to as the CARE trial, in pediatric patients with biliary atresia.

•

Pipeline Development:  We completed a Phase 1 clinical trial of our second product candidate to enter clinical development, called INT-767, a dual FXR and TGR5 agonist, in healthy volunteers.

•

Structure for Success:  We continued to add infrastructure and personnel in the United States and internationally to support our product development and commercialization efforts and operations as a public company. We procured sufficient quantities of bulk commercial supply to initiate our commercial launch for Ocaliva for PBC to date. In July 2016, we completed an underwritten public offering of $460.0 million in aggregate principal amount of 3.25% convertible senior notes due 2023, or the convertible notes. After deducting the underwriting discounts and offering expenses of approximately $12.4 million, the net proceeds from the convertible notes offering were approximately $447.6 million. We ended fiscal 2016 with a strong financial position to support our continued commercialization of Ocaliva for PBC and our development programs with approximately $689.4 million in cash, cash equivalents and investment securities.cholestatic liver disease.

At the 2016 annual meeting of stockholders, over 99% of the shares cast affirmatively or negatively voted in favor of approving our 2015 executive compensation.

Executive Compensation Philosophy

The primary objective of our executive compensation policy is to attract, retain and motivate the key executives necessary for our short-term and long-term success. We seek to tie short-term and long-term compensation to employee performance, including the achievement of measurable corporate objectives, and to align executives’ incentives with stockholder value.

The compensation committee approves compensation based on certain compensation philosophies, including the following:

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AlignedResolved Ocaliva Label Update.  In September 2017, we issued a dear healthcare provider letter and the U.S. Food and Drug Administration (the “FDA”) also subsequently issued its own safety communication to reinforce recommended dosing in accordance with the Ocaliva label, following the reporting of deaths in certain PBC patients prescribed Ocaliva with moderate or severe hepatic impairment. In an analysis performed by us and in consultation with the FDA, we concluded that these patients were prescribed once daily doses of Ocaliva, which is seven times higher than the recommended weekly dose in such patients. Both communications reminded healthcare providers of the importance of the recommended reduced dosing of Ocaliva in PBC patients with moderate or severe hepatic impairment, while reiterating the importance of monitoring PBC patients for progression of their disease and the occurrence of liver-related adverse reactions. In February 2018, we announced that the Ocaliva label in the United States had been updated by the FDA to include a boxed warning and a dosing table that reinforce the existing dosing schedule for patients with Child-Pugh Class B or C or decompensated cirrhosis, and the FDA issued an updated drug safety communication to accompany the revised label. We are focused on the safety of all of the patients using Ocaliva within and outside of our ongoing clinical studies and, with this updated label, remain confident in the benefit that Ocaliva provides when used as directed in patients with PBC.

Strengthened Executive Leadership Team.  We continued to strengthen our leadership team with the addition of a number of talented executives with extensive experience in the biopharmaceutical industry, including Jerome Durso, our new Chief Operating Officer, David Ford, our new Chief Human Resources Officer, Christian Weyer, M.D., M.A.S., our new EVP, Research & Development, and Ryan Sullivan, our new General Counsel and Secretary. We believe that these individuals will provide critical leadership and support for our product development and commercialization efforts, as well as our operations as a commercial-stage public company.

CEO COMPENSATION HIGHLIGHTS

Our CEO

Dr. Mark Pruzanskico-founded our Company and has served as our CEO since our inception in 2002. Dr. Pruzanski has been critical in driving many of our achievements over the past 15 years.

Market-Based CEO Compensation.  For 2017, we determined total CEO compensation (including annual equity awards) with reference to the 50th percentile of the competitive market based on our compensation peer group. In 2018, we continued this approach and again determined total CEO compensation (including annual equity awards) with reference to this percentile.

Break-Down of 2017 CEO Compensation

Significant Performance Elements.  In 2017, we incorporated significant performance elements into Dr. Pruzanski’s annual and long-term incentive compensation arrangements. Approximately 89% of Dr. Pruzanski’s 2017 total direct compensation consisted of variable compensation elements dependent on our achievement of corporate performance goals and objectives and our stock price performance.

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TSR-Based Performance Share Units.  In 2018, we introduced performance share unit awards (“TSR PSUs”) that vest, if at all, based on the Total Shareholder Return (“TSR”) of our common stock relative to that of the companies comprising the S&P Biotechnology Select Industry Index (“TSR Peer Group”) over a 3-year period, subject to continued employment. As a result, 100% of Dr. Pruzanski’s 2018 annual equity awards consisted of performance-based equity awards, with approximately half of the grant date fair value comprised of TSR PSUs and the remaining half comprised of stock options.

Executive Leadership.  Our CEO leads a highly-experienced executive team that has enabled our company to achieve the milestones described above.

COMPENSATION AND GOVERNANCE BEST PRACTICES

What We Do

Independent Chairman, Lead Independent Director and Majority Independent Board.  Paolo Fundarò serves as our Board’s Chairman, and all of the members of our Board (except Dr. Pruzanski) are independent directors. In February 2018, we appointed Gino Santini to serve as our Board’s Lead Independent Director, which we believe enhances our Board governance structure and will contribute to the overall effectiveness of our Board. In addition, in April 2018, we appointed Nancy Miller-Rich as a new independent director to our Board.

Independent Compensation Committee.  Our Compensation Committee, which is composed entirely of independent directors, provides independent oversight of our compensation programs.

Independent Compensation Consultant.  Our Compensation Committee uses an independent executive compensation consulting firm that reports directly to the committee.

Annual Compensation Review and Analysis.  Our Compensation Committee conducts an annual assessment of executive compensation to ensure that we provide competitive compensation packages to attract, retain, reward and incentivize our executive management team to achieve success for us and our stockholders.

Multiple Performance Elements.  In accordance with our performance-based compensation philosophy, our executive compensation program incorporates multiple performance elements, including target-based cash incentive bonuses payable upon the achievement of corporate culture.  Theand individual goals and objectives, and long-term equity incentive compensation, principlesa substantial portion of which consists of stock options and, commencing with our 2018 annual equity grants, TSR PSUs.

Market Benchmarking and Use of Reference Peer Group.  Our Compensation Committee, with the assistance of its independent compensation consultant, annually analyzes similar life science companies to identify a relevant group of peer companies for purposes of ensuring the reasonableness and competitiveness of our executive compensation program.

Stock Ownership Requirements.  We have adopted minimum stock ownership guidelines for our Board, CEO and other executive leadership team should be aligned with those for all employeesofficers, including our named executive officers, which require, within specified periods of time, our non-employee directors to help create a company-wide performance culture.hold Company equity equal to at least 3x their annual cash retainer and our CEO and other executive officers to hold Company equity equal to at least 3x and 1x, respectively, their annual base salary.

Clawback Policy.  In early 2018, we adopted a clawback policy that permits the Company to recover, from any current or former executive officer, including any named executive officer, whose fraud or intentional misconduct contributes to the circumstances requiring the Company to prepare an accounting restatement due to material non-compliance of the Company with any financial reporting requirement under U.S. federal securities laws, up to 100% of any incentive-based compensation received by such officer from the Company during the one-year period preceding the date on which the Company is required to prepare such accounting restatement.

Compensation Risk Assessment.  In 2018, we strengthened our annual compensation risk assessment review process.

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What We Don’t Do

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No excise tax gross-ups.  We have not provided excise tax gross-ups to any of our named executive officers.

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No “single-trigger” change-in-control protections.  The change-in-control protections for our named executive officers are limited to “double-trigger” arrangements, which do not provide for automatic payment upon the occurrence of a change in control. Instead, such arrangements require both a change in control and a qualifying termination of employment to occur.

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Limited perquisites.  Our named executive officers generally receive the same benefits as are available to all of our salaried employees, with limited recurring exceptions primarily consisting of fully-paid health insurance premiums.

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No automatic or guaranteed annual salary increases.  We do not provide for any formulaic or guaranteed base salary increases for our named executive officers.

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No guaranteed bonuses.  We do not provide guaranteed bonuses to our named executive officers.

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No hedging or pledging of Company stock.  Our named executive officers and other employees are restricted from engaging in speculative trading activities, including hedging or pledging their company securities as collateral.

STOCKHOLDER ENGAGEMENT

Annual “Say-on-Pay”.  We have determined to hold an advisory vote on the compensation of our named executive officers (a “say-on-pay” vote) every year. Our 2017 advisory say-on-pay proposal was approved by over 99% of the votes cast on the proposal. Our Compensation Committee took this result into consideration when designing the structure of our 2018 annual compensation program, including the performance-based elements thereof, such as the TSR PSUs granted to our executive officers in early 2018.

Communication with Stockholders.  We believe that stockholder engagement is important and we regularly communicate with our largest stockholders. As we mature as a company, we will continue to expand our stockholder engagement efforts. We welcome feedback with respect to our executive compensation practices from all of our stockholders.

Focus on Stockholder Value.  Our Compensation Committee members, who are themselves stockholders, approved the compensation for our CEO and other named executive officers with the goal of driving long-term company performance and stockholder returns.

Executive Compensation Philosophy

We have adopted a performance-based compensation philosophy that is intended to attract, retain, reward and incentivize our executive officers to achieve our near-term corporate goals, as well as our long-term strategic objectives. In particular, our philosophy is designed to achieve the following objectives:

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Our Executive Compensation Process

The Role of the Compensation Committee

Our Compensation Committee is responsible for the evaluation and oversight of our executive compensation program, policies and practices. Accordingly, our Compensation Committee reviews and approves all compensation provided to our named executive officers, including adjustments to base salaries, annual target-based cash incentive bonuses, equity incentive awards, severance arrangements and benefit programs. Our Compensation Committee consists of three members of our Board, each of whom has extensive experience in our industry and is an independent director under applicable Nasdaq and SEC rules. Our Compensation Committee uses its judgment and experience to develop and approve executive compensation decisions, including our Chief Executive Officer’s compensation package. In doing so, our Compensation Committee meets with an independent compensation consultant in executive session without our Chief Executive Officer or any other member of management present. Our Compensation Committee also periodically evaluates the need for revisions to our executive compensation program to ensure our program is competitive with the companies with which we compete for executive talent.

Management’s Involvement in the Executive Compensation Process

A small number of executive officers, including our Chief Executive Officer, participate in general sessions of our Compensation Committee. Management does not participate in executive sessions of our Compensation Committee. At the request of our Compensation Committee, our Chief Executive Officer provides input and recommendations to the committee on salary adjustments, annual target-based cash incentive bonus amounts and appropriate equity incentive compensation levels in relation to our executive officers other than himself. In formulating these recommendations, our Chief Executive Officer may consider data obtained from third-party sources, including data provided by compensation consultants other than the independent compensation consultant retained by our Compensation Committee.

Use of Independent Compensation Consultants by the Compensation Committee

In designing our executive compensation program, our Compensation Committee considers publicly available compensation data for other companies in the biopharmaceutical industry to help guide its executive compensation decisions at the time of hiring and for subsequent adjustments in compensation. In 2017, our Compensation Committee also retained the services of Radford, an independent compensation consultant and subdivision of Aon plc, to provide it with additional comparative data on executive compensation practices in our industry and to advise it on our executive compensation program generally. For 2017, Radford provided advice and data to our Compensation Committee on executive and director compensation matters, including the selection of our compensation peer group, comparative market pay levels, equity dilution and annual share utilization practices, incentive plan design and emerging market trends. Although our Compensation Committee considers the advice and recommendations of its compensation consultant about our executive compensation program, the committee ultimately makes its own decisions about these matters. Our Compensation Committee determined that the work of Radford did not raise any conflicts of interest in 2017. In making this assessment, our Compensation Committee considered the independence factors enumerated in Rule 10C-1(b) under the Exchange Act and the applicable Nasdaq rules.

Market Benchmarking and Peer Group

Our Compensation Committee references a peer group of publicly traded companies in the biopharmaceutical industry for purposes of gathering data to compare with our existing executive compensation levels and practices and as context for future compensation decisions. Our Compensation Committee, with the assistance of its independent compensation consultant, periodically reviews and updates the compensation peer group, as appropriate, to include companies that the Compensation Committee believes are competitors for executive talent and are similar to us based on a number of criteria, including stage of development, revenue, market capitalization and number of employees. Our Compensation Committee may consider peer group and other industry compensation data and the recommendations of its independent compensation consultant when making decisions related to executive compensation. Our Compensation Committee also considers peer companies identified by proxy advisory firms in the prior year’s proxy cycle. Changes in the composition of our compensation peer group from 2016 to 2017 were largely the result of,

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among other things, the replacement of companies that had been acquired or that our Compensation Committee, with the assistance of its independent compensation consultant, no longer considered comparable to us in light of the criteria outlined above. The companies included in our compensation peer group for 2017 were as follows:

ACADIA Pharmaceuticals Inc.		Ionis Pharmaceuticals, Inc.		Seattle Genetics Inc.
Alkermes plc		Ironwood Pharmaceuticals, Inc.		Tesaro, Inc.
Alnylam Pharmaceuticals, Inc.		Neurocrine Biosciences, Inc.		The Medicines Company
bluebird bio, Inc.		Ophthotech Corporation		Ultragenyx Pharmaceutical Inc.
Exelixis, Inc.		Puma Biotechnology, Inc.		United Therapeutics Corporation
Incyte Corporation

At the beginning of 2017, based on the input and analysis provided by Radford and the recommendation of our Chief Executive Officer (except with respect to his own compensation), our Compensation Committee determined that 2017 target total direct compensation for our Chief Executive Officer and other named executive officers employed by the Company would be determined with reference to the 50^th percentile of compensation for executives holding similar positions at the companies in our compensation peer group. In determining each named executive officer’s equity incentive award, our Compensation Committee examined peer group compensation data provided by Radford and other related compensation data. When hiring our new Chief Operating Officer and new Chief Human Resources Officer during 2017, our Compensation Committee continued to use this approach, although it supplemented annual compensation with one-time “sign-on” equity awards as necessary and appropriate to achieve the Company’s recruitment and retention objectives and to closely align the interests of the new named executive officer with those of our stockholders.

Annual Compensation Review Process

On an annual basis, our Compensation Committee meets to review the performance of our Chief Executive Officer and our other named executive officers. At these meetings, our Compensation Committee typically invites our Chief Executive Officer to participate in the discussion (excluding discussions pertaining to his own compensation) in order to seek our Chief Executive Officer’s input and recommendations with respect to each named executive officer (other than himself) as to:

Our Compensation Committee takes into consideration these recommendations and other relevant performance and competitive market factors when it makes its determination on executive compensation matters. Our Compensation Committee also meets to review and decide compensation matters periodically throughout the year.

Consideration of Prior Stockholder Advisory Vote to Approve Named Executive Officer Compensation

We have determined to hold an advisory vote on the compensation of our named executive officers (a “say-on-pay” vote) every year. Each year, our Compensation Committee considers the outcome of the prior year’s say-on-pay vote when making decisions relating to the compensation of our named executive officers and our executive compensation programs and policies. At our 2017 Annual Meeting of Stockholders, our stockholders demonstrated strong support of our named executive compensation programs, with our 2017 advisory say-on-pay proposal being approved by over 99% of the votes cast on the proposal. Our Compensation Committee took this result into consideration when designing the structure of our 2018 annual compensation program, including the performance-based elements thereof, such as the TSR PSUs granted to our executive officers in early 2018. Our Compensation Committee will continue to take into account future stockholder advisory votes to approve executive compensation and other relevant market developments affecting executive officer compensation in order to determine whether any subsequent changes to our programs and policies are warranted to reflect stockholder concerns or to address market developments.

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Additional Compensation Risk Management Initiatives

We strive to incorporate best practices in our executive compensation program, including by adopting from time to time additional compensation policies and practices that discourage excessive or unnecessary risk-taking. For example, in early 2018, we adopted a clawback policy that permits the Company to recover, from any current or former executive officer, including any named executive officer, whose fraud or intentional misconduct contributes to the circumstances requiring the Company to prepare an accounting restatement due to material non-compliance of the Company with any financial reporting requirement under U.S. federal securities laws, up to 100% of any incentive-based compensation received by such officer from the Company during the one-year period preceding the date on which the Company is required to prepare such accounting restatement. We also strengthened our annual compensation risk assessment review process in 2018.

We have adopted minimum stock ownership guidelines for our Board, Chief Executive Officer and other executive officers, including our named executive officers, which require, within a five-year period, our non-employee directors to hold Company equity equal to at least 3x their annual cash retainer and our Chief Executive Officer and other executive officers to hold Company equity equal to at least 3x and 1x, respectively, their annual base salary. Until the ownership guidelines are satisfied, our non-employee directors and executive officers are required to maintain a minimum retention ratio of at least 50% of their annual equity awards, net of shares sold or withheld solely to pay applicable exercise fees and/or withholding taxes. Any non-employee director or executive officer failing to meet the guidelines within the allotted compliance period will be required to maintain a minimum retention ratio of 100% of net shares after the applicable exercise fees and/or withholding taxes.

We have not provided excise tax gross-ups to any of our named executive officers and change-in-control protections for our named executive officers are limited to “double-trigger” arrangements, which do not provide for automatic payment upon the occurrence of a change in control. Instead, such arrangements require both a change in control and a qualifying termination of employment to occur. Our named executive officers generally receive the same benefits as are available to all of our salaried employees, with limited recurring exceptions primarily consisting of fully-paid health insurance premiums. We do not provide for any formulaic or guaranteed base salary increases for our named executive officers and we do not provide guaranteed bonuses to our named executive officers. In addition, our employees, including our named executive officers, are restricted from engaging in speculative trading activities, including hedging or pledging their company securities as collateral.

Components of Our Executive Compensation Program

The primary elements of our executive compensation program are:

The compensation committeeOur Compensation Committee believes that a significant amount of executive compensation should be in the form of “at risk” incentives and that the pay mix should be strongly weighted toward equity incentive awards in order to provide alignment with long-term stockholder value. However, we do not have a formal or informal policy for a pre-set allocation between long-term and short-term compensation, between cash and non-cash compensation or among different forms of non-cash compensation. Instead, our compensation committee,Compensation Committee, after reviewing information provided by ourits independent compensation consultant and other relevant data, determines what it believes to be the appropriate level and mix of the various compensation components. We generally strive to provide our named executive officers with a balance of short-term and long-term incentives to encourage consistently strong performance. Ultimately, the objective in allocating between long-term and currently paid compensation is to ensure adequate base compensation to attract and retain personnel, while providing incentives to maximize long-term value for Interceptthe Company and our its

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stockholders. Therefore, we provide base salaries that meet competitive salary norms and recognize individual performance on an annual basis. We provide an opportunity to earn annual target-based cash incentive bonuses to incentivize and reward superior short-term performance. To further focus our executivesnamed executive officers on longer-term performance and the creation of stockholder value, we rely upon equity-based awards that vest over a meaningful period of time. In addition, we provide our executives with benefits that are generally available to our salaried employees.time and the value of which is dependent on stock price performance.

Base salary

We use base salaries to recognize the experience, skills, knowledge and responsibilities of our employees, including our named executive officers. Base salaries for ournewly-hired named executive officers typically are established through an arm’s-length negotiation at the time the executiveindividual is hired, taking into account factors such as the position for which the executiveindividual is being considered, and the executive’sindividual’s qualifications, prior experience and prior salary.base salary (to the extent available) and competitive market demand. None of our named executive officers is currently party to an employment agreement that provides for automatic or scheduled increases in base salary. However, on an annual basis, our compensation committeeCompensation Committee reviews and evaluates, with input from our chief executive officer,Chief Executive Officer (other than with respect to his own base salary), the need for adjustment of the base salaries of our executivesnamed executive officers based on changes and expected changes in the scope of an executive’stheir responsibilities. The compensation committeeOur Compensation Committee also considers promotions, the individual contributions made by and performance of the named executive officer during the prior fiscal year, the executive’sindividual’s performance over a period of years, overall economic and labor market conditions, the relative ease or difficulty of replacing the executiveindividual with a well-qualified person, our overall growth and development as a company, general salary trends in our industry and among our compensation peer group and where the executive’sindividual’s salary falls in the salary range presented by that data. For more information regarding our compensation peer group, see “Our“—Our Executive Compensation Process — Process—Market Benchmarking and Peer Group.”Group” above. In making decisions regarding salary increases, weour Compensation Committee may also draw upon the experience of members of our board of directorsBoard with other companies. We do not provide for any formulaic base salary increases for our named executive officers.

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named executive officer is established as a target percentage of his or hersuch officer’s base salary. The actual annual cash incentive bonus amounts payable to our named executive officers are determined after year end based on the compensation committee’sour Compensation Committee’s evaluation of performance against the corporate objectives and, in the case of our named executive officers other than Dr. Pruzanski,our Chief Executive Officer, the achievement of individual performance levels. Individual performance of the named executive officers other(other than Dr. Pruzanskiour Chief Executive Officer) is determined by the compensation committeeour Compensation Committee after considering the overall performance of the individual executiveofficer and taking into account the recommendations of the chief executive officer. The overall assessment by our compensation committee isChief Executive Officer.

Our Compensation Committee believes that a cash incentive bonus program based on the evaluation of objective metrics,multiple corporate objectives and individual performance (with respect to our named executive officers other than our Chief Executive Officer) is best-suited for a biopharmaceutical company at our stage of development due to the uncertainties inherent in the development, regulatory approval and commercialization of new drug treatments. Our Compensation Committee also considers the practices of our compensation peer group and overall industry practices as part of its review of our cash incentive bonus program. In order to better align cash incentive bonus payouts with performance, our Compensation Committee may take additional significant corporate achievements into account for the current year’s cash incentive bonus calculation that were not contemplated at the time the current year corporate objectives were determined. Our Compensation Committee also has the authority to shift corporate objectives to subsequent fiscal years and to eliminate them for the current year’s cash incentive bonus calculation if it determines that underachievement of a goal was primarily caused by circumstances that were beyond the named executive officer’s control or if it determines that the business priorities for the year had shifted. Each of our Compensation Committee and Board has authority, in its sole discretion, to review and approve management’s evaluation of how we performed against our corporate objectives and the recommended cash incentive bonus payout levels. This authority includes the ability to rate the accomplishment of particular objectives at below, equal to or greater than 100% of target based on the Company’s performance.

The target annual cash incentive bonus for each named executive officer is set by our Compensation Committee as a percentage of such officer’s base salary. The target percentages approved by our Compensation Committee are typically based on an evaluation of compensation peer group data, as the successful achievementwell as consideration of the applicable goallevel of qualification and experience of each named executive officer as well as internal pay comparisons. Based on this evaluation, our Compensation Committee determined to maintain the weightings ascribed to such goal, which is then adjusted to reflect other factors that may be pertinent to the performance of the company and the individual2017 annual cash incentive bonus target percentages for our named executive officer.officers at their 2016 levels.

TheOur annual corporate objectives includehave historically included the achievement of specific clinical, regulatory, commercial and precommercial, operational and/or financial milestones, with a focus on regulatory achievements, commercial and precommercial preparedness, commercial net sales amounts, the advancement of our product candidates in clinical development, the pursuit of various internal initiatives and ensuring adequate funding for our growth. As we continue to transition from a development-stage company to a commercial-stage company, we have begun to introduce precommercial and commercial-related milestones into our annual corporate objectives, with added focus on precommercial and commercial preparedness, commercial sales metrics and regulatory achievements. The corporate objectives are proposed by senior management each year and reviewed and approved by our compensation committeeCompensation Committee and board of directorsBoard in the beginning of our fiscal year, with such modifications as the compensation committeeour Compensation Committee and board of directorsBoard deem appropriate. TheIn connection with such approval, our Compensation Committee and Board conduct a rigorous review designed to ensure that such objectives reflect the corporate performance measures that we believe are most important to the success of our company and will drive stockholder value. In addition, the corporate objectives are designedset at challenging levels so as to require significantour named executive officers to expend substantial effort and operational success on the part ofcommitment leveraging their individual and collective skills and competencies to attain such goals and objectives.

For 2017, our executivesannual corporate objectives are summarized below:

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Our compensation committee believes that a bonus program based on the evaluation of multiple

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Our compensation committee did not set any specific individual performance targets for the payment ofChief Executive Officer’s cash bonuses to our named executive officers in 2016. Instead, the compensation committee reviewed our company performance against our 2016 corporate objectives and also evaluated the individual performance of each named executive officer. Dr. Pruzanski’sincentive bonus is determined solely based on the achievement of corporate goals, whereas the cash incentive bonus for our other named executive officers is based on both our corporate goals and individual performance.

The 2016 Our Compensation Committee’s assessment of the individual performance of our named executive officers (other than our Chief Executive Officer) may result in such officers receiving cash incentive bonuses that are higher or lower than the amounts that they would otherwise receive if such bonuses were based on the achievement of corporate goals alone. For 2017, our Compensation Committee reviewed our performance against our 2017 corporate objectives and determined the individual performance of the named executive officers (other than our Chief Executive Officer) after evaluating their individual performance levels in consultation with the Chief Executive Officer. For 2017, the target and actual cash incentive bonuses for each of our named executive officer were:officers were as follows:

Executive		Target Bonus as % of Base Salary				Actual Bonus as % of Target
Mark Pruzanski, M.D.			70	%			80	%
David Shapiro, M.D.			50	%			80	%
Sandip Kapadia			50	%			92	%
Rachel McMinn, Ph.D.			50	%			90	%
Lisa Bright			50	%			85	%
Barbara Duncan(1)			50	%			100	%

Named Executive Officer		Target Bonus (as % of Base Salary)				Actual Bonus (as % of Target)
Mark Pruzanski, M.D.			70	%			85	%
Sandip Kapadia			50	%			89	%
Jerome Durso			50	%			100	%
David Ford			50	%			89	%
David Shapiro, M.D.			50	%			70	%

Please refer to “—Compensation Decisions Relating to Fiscal Year 2018” below for a listing of the target annual cash incentive bonuses for each of our named executive officers for 2018.

(1)

Pursuant to the Duncan Transition Agreement, Ms. Duncan was eligible to receive a bonus equal to 50% of her pro-rated 2016 base salary.

Equity incentive awards

Incentive Awards

Our equity awardincentive program is the primary vehicle used for offeringproviding long-term incentives to our executives.executive officers, including our named executive officers. We believe that equity awards provide our executivesnamed executive officers with a strong link to our long-term performance, create an ownership culture and help to align the long-term interests of our executivessuch officers and our stockholders. In addition, we believe that equity awards with a time-basedtime- or performance-based vesting feature promote executive retention because this feature incentivizesthese features incentivize our named executive officers to remain in our employment during the vesting period.

To date, we have used equity awards both to compensate our named executive officers in the form of new hire grants at theirthe commencement of their employment and to provide ongoing long-term incentives to our named executivesuch officers as our business has developed. We also generally plan to continue to grant equity awards on at least an annual basis to all of our named executive officers. Typically, stock optionsoption and shares of restricted stock (or restricted stock unit) awards granted to our named executive officers vest over a period of four years, subject to continued employment. Subject to the terms of each executive officer’s employment agreement as described below, vesting ceases upon termination of employment, and stock option exercise rights cease shortly after termination of employment. The exercise price for any InterceptCompany stock option is set at no less than the fair market value of our common stock on the date of grant, as determined by reference to the closing market price of our common stock on the date of grant.such date.

Annual equity awardsEquity Awards

In determining the size of the annual equity awards granted to our named executive officers, our compensation committeeCompensation Committee considers recommendations developed by ourits independent compensation consultant, including information regarding comparative stock ownership of, and equity awards received by, the executives in our compensation peer group and our industry. In addition, our compensation committeeCompensation Committee considers each executive’snamed executive officer’s individual performance and the extent to which such executiveofficer has vested in previous equity awards, as well as our overall corporate performance and the potential for enhancing the long-term creation of value for our stockholders.

EquityAnnual equity awards to our named executive officers are typically granted annuallyeach year in conjunction with the review of their individual performance and Intercept’sour overall corporate performance for the previous year. This review typically occurs at meetings of the compensation committeeour Compensation Committee held during the first quarter of each year.

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of the annual equity awards as a percentage of our company’s outstanding stock, dilution to existing stockholders and the retention value in the outstanding equity program based on the value of outstanding unvested awards, all of which were considered in light of individual and companycorporate performance for the previous year, 2015. Based on the recommendation of our chief executive officer, and in consideration of our company’s performance and the market performance of our common stock, our compensation committee determined that it would be appropriate to grant equity awards targeting the 50^th percentile range of our peer group and industry.2016. To promote our pay-for-performanceperformance-based compensation philosophy, individual equity awards were positioned higher or lower within the compensation peer group range based on the individual performance of each named executive officer.

We believe that a mix of compensation components incentivizes consistently strong performance. In 2016, the compensation committee2017, our Compensation Committee granted equity incentives into our named executive officers a mix of equity incentive awards, including stock optionsoption and restricted stock.stock awards. Our approach reflects what we believe is an appropriate equity mix,allocation, providing executivesour named executive officers with exposure to downside stock-price risk through stock options, while addressing the historically high volatility of our common stock through the restricted stock award component. This approach also helps manage overall dilution levels and the remaining equity pool available under our 2012 Equity Incentive Plan (“2012 Plan”) in light of our significant recent growth and continuedfuture potential expansion in company-wideof company headcount. We expect these two typesIn 2018, we retained the use of equity incentives to bestock option and restricted stock (or restricted stock unit) awards and introduced as part of our annual equity award program performance share unit awards that vest, if at all, based on our TSR relative to that of our TSR Peer Group over a 3-year period, subject to continued employment. Approximately half of the compensation mix ongrant date fair value of Dr. Pruzanski’s 2018 annual equity award was comprised of such TSR PSUs and the remaining half was comprised of stock options. Our other named executive officers received an equal proportion of the grant date fair value of their 2018 annual basis.equity awards in the form of such TSR PSUs, stock options and restricted stock units. Please refer to “—Compensation Decisions Relating to Fiscal Year 2018” below for a listing of grants made to each of our named executive officers in connection with our 2018 annual equity award program.

2016 Equity Awards

In February 2016,2017, as part of our annual grant process, our compensation committeeCompensation Committee approved the grant of certain time-based options to purchase shares of our common stock option and shares of restricted stock awards to our named executive officers. Each of the time-basedThe stock option awards and shares of restricted stock vestedgranted in connection with respect toour 2017 annual grant have (i) a four-year vesting period, with 25% of the shares on January 1, 2017, and vest with respectsubject to the remainingaward vesting in an initial annual installment following the relevant vesting commencement date and 1/48^th of the shares in approximately equal monthly installments forsubject to the stock optionsaward vesting each month thereafter, subject to continued employment and quarterly installments for the restricted stock through January 1, 2020. The time-based stock option awards have(ii) an exercise price of $94.29$107.18 per share, the last reported sale price of our common stock on the NASDAQNasdaq Global Select Market on the date of grant. The restricted stock awards granted in connection with our 2017 annual grant have a four-year vesting period, with 25% of the shares subject to the award vesting in an initial annual installment following the relevant vesting commencement date and 1/16^th of the shares subject to the award vesting each quarter thereafter, subject to continued employment. The grants made to each of our named executive officers in connection with our 2017 annual equity award program are set forth in the following table. Please refer to “—Components of Our Executive Compensation Program—Equity Incentive Awards—New Hire Equity Awards” below for a listing of grants made to Mr. Durso and Mr. Ford in 2017.

Name		Time-Based Awards (# of Shares)
		Options				Restricted Stock
Mark Pruzanski, M.D.			30,500				23,300
David Shapiro, M.D.			10,200				7,800
Barbara Duncan			8,100				6,200
Rachel McMinn, Ph.D.			8,800				6,700
Lisa Bright			10,200				19,525	(1)

Named Executive Officer		Stock Options				Shares of Restricted Stock
Mark Pruzanski, M.D.			40,000				23,200
Sandip Kapadia			11,600				7,000
David Shapiro, M.D.			10,000				6,000

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option awards granted to Mr. Durso and Mr. Ford have (i) a four-year vesting period, with 25% of the shares subject to the award vesting in an initial annual installment following the relevant vesting commencement date and 1/48^th of the shares subject to the award vesting each month thereafter, subject to continued employment and (ii) an exercise price of $146.36,$115.93 per share (in the case of Mr. Durso) and $114.90 per share (in the case of Mr. Ford), which is equal towas the closinglast reported sale price forof our common stock on the NASDAQNasdaq Global Select Market on the relevant date of grant. The restricted stock awards granted to Mr. Durso and Mr. Ford have a four-year vesting period, with 25% of the shares subject to the award vesting in an initial annual installment following the relevant vesting commencement date and 1/16^th of the shares subject to the award vesting each quarter thereafter, subject to continued employment.

Name		Time-Based Awards (# of Shares)
		Options				Restricted Stock
Sandip Kapadia			18,000				15,000

Named Executive Officer		Stock Options				Shares of Restricted Stock
Jerome Durso			20,000				15,000
David Ford			12,000				6,000

Benefits and other compensation

Other Compensation

We believe that establishing competitive benefit packages for our employees is an important factor in attracting and retaining highly qualified personnel. We maintain broad-based benefits that are provided to all employees, including medical, dental, vision, group life insurance and long- and short-term disability insurance. For our U.S.-based executives,employees, we also provide a 401(k) plan. Under our 401(k) plan, we are permitted to make discretionary contributions and matching contributions, subject to established limits and a vesting schedule. Since 2015, we have matched an employee’s contributions to the 401(k) plan up to the first five percent of the employee’s salary.salary, subject to such limits. We provide pension, insurance and other benefits to executivesemployees located outside the United States in line with those provided to similar executivesemployees in their respective countries. All of our executivesOur named executive officers generally receive the same benefits as are eligibleavailable to participate in all of our employee benefit plans available in their respective countries, in each case on the same basis as other employees. The compensation committeesalaried employees, with limited recurring exceptions primarily consisting of fully-paid health insurance premiums. Our Compensation Committee in its discretion may revise, amend or add to thea named executive officer’s benefits and perquisites if it deems it advisable.

In For example, in particular circumstances, we may agree to reimburse ana named executive officer for certain expenses, such as commuting or travel expenses, as an additional incentive to join Interceptus in a position where there is high market demand. Whether such expenses are covered and the amount of the reimbursement is determined on a case-by-case basis under the specific hiring circumstances. In 2016, we reimbursed Ms. Bright for her2017, Mr. Kapadia received an aggregate commuting costs, which reimbursement is capped at a maximumallowance of £1,080 per month (approximately $1,313.93), plus gross ups on the applicable tax amounts. Ms. Bright$2,165 and Dr. Shapiro also received aan aggregate car allowance in 2016.of $12,000. Mr. Kapadia ceased receiving such commuting allowance following the second quarter of 2017. See “—Summary Compensation Table.”Table” below.

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Market Benchmarking and Peer Group

Our compensation committee references a peer group of publicly traded companies in the biopharmaceutical industry for purposes of gathering data to compare with our existing executive compensation levels and practices and as context for future compensation decisions. The compensation committee periodically reviews and updates the compensation peer group, as appropriate, to include companies that the compensation committee believes are competitors for executive talent and that are similar to us in stage of development, market capitalization and number of employees. The compensation committee may consider peer group and other industry compensation data and the recommendations of our compensation consultant when making decisions related to executive compensation, ultimately giving consideration to the competitiveness of our compensation program, internal perceptions of equity and individual performance. The compensation committee also considered peer companies identified by proxy advisory firms in the prior year’s proxy cycle.

The companies included in our peer group for 2016 were: ACADIA Pharmaceuticals Inc., Alkermes plc, Alnylam Pharmaceuticals, Inc., Anacor Pharmaceuticals, Inc., bluebird bio, Inc., Ironwood Pharmaceuticals, Inc., Medivation, Inc., Merrimack Pharmaceuticals, Inc., Neurocrine Biosciences, Inc., Ophthotech Corporation, Puma Biotechnology, Inc., Seattle Genetics Inc., Tesaro, Inc., Ultragenyx Pharmaceutical Inc. and United Therapeutics Corporation.

Annual Compensation Review Process

At the end of each calendar year, the compensation committee considers each executive’s performance for the completed year. This process includes the review of recommendations by our chief executive officer to the compensation committee with respect to each executive officer (other than himself) as to:

the achievement of stated corporate performance objectives;

the level of contributions made to the general management and guidance of Intercept; and

the amount of any salary increases, cash bonus payouts and new equity awards.

The compensation committee takes into consideration these recommendations and other relevant performance and competitive market factors when it makes its determination on executive compensation matters.

Consideration of Prior Stockholder Advisory Vote to Approve Named Executive Officer Compensation

Each year, our compensation committee considers the outcome of the annual stockholder advisory vote to approve named executive office compensation when making decisions relating to the compensation of our named executive officers and our executive compensation programs and policies. At our 2016 annual meeting of stockholders, our stockholders demonstrated strong support of our named executive compensation programs. The compensation committee will continue to take into account future stockholder advisory votes to approve executive compensation and other relevant market developments affecting executive officer compensation in order to determine whether any subsequent changes to our programs and policies are warranted to reflect stockholder concerns or to address market developments.

Compensation Decisions Relating to Fiscal Year 2017

2018

In February 2017, in order to provide each of our named executive officers with base salaries that are competitive with our publicly traded peer companies,2018, the annual base salaries of our named executive officers were increasedset by our Compensation Committee as follows, effective January 1, 2017: for Dr. Pruzanski, to $675,000; for Dr. Shapiro, to $489,300; for Ms. Bright to £320,000; for Dr. McMinn, to $432,600; and for Mr. Kapadia, to $425,000. 2018:

Named Executive Officer		2018 Salary				2017 Salary				Change from 2017
Mark Pruzanski, M.D.		$	702,000			$	675,000				4.00	%
Sandip Kapadia		$	442,000			$	425,000				4.00	%
Jerome Durso		$	540,800			$	520,000				4.00	%
David Ford		$	392,000			$	380,000				3.16	%
David Shapiro, M.D.		$	489,300			$	489,300				—

In addition, in February 2018, our Compensation Committee determined to maintain the 2018 annual cash incentive bonus target percentages for our named executive officers at their 2017 our board of directorslevels, and approved cash incentive bonus targets for our named executive officers for 20172018 as follows: for Dr. Pruzanski, 70%; for Dr. Shapiro, 50%; for Ms. Bright, 50%; for Ms. McMinn, 50%; and for Mr. Kapadia, 50%.

Named Executive Officer		Target Bonus (as % of Base Salary)
Mark Pruzanski, M.D.			70	%
Sandip Kapadia			50	%
Jerome Durso			50	%
David Ford			50	%
David Shapiro, M.D.			50	%

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In February 2017, the compensation committee of the board of directors2018, our Compensation Committee approved the following equity grants to our named executive officers: for Dr. Pruzanski,

Named Executive Officer		TSR PSUs				Stock Options				Restricted Stock Units
Mark Pruzanski, M.D.			23,400				45,500				—
Sandip Kapadia			5,400				10,500				6,900
Jerome Durso			10,600				20,700				13,600
David Ford			3,400				6,600				4,300
David Shapiro, M.D.			2,300				4,400				2,900

The stock optionsoption awards granted in connection with our 2018 annual grant have (i) a four-year vesting period, with 25% of the shares subject to purchase 40,000the award vesting in an initial annual installment following the relevant vesting commencement date and 1/48^th of the shares of common stocksubject to the award vesting each month thereafter, subject to continued employment and 23,200 shares of restricted stock; for Dr. Shapiro, stock options to purchase 10,000 shares of common stock and 6,000 shares of restricted stock; for Ms. Bright, stock options to purchase 7,800 shares of

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Summary Compensation Table

The following table sets forth information regarding compensation awarded to, earned by or paid to our named executive officers during the years ended December 31, 2016, 2015 and 2014.

Name and Principal Position		Year				Salary ($)				Bonus(1) ($)				Stock Awards(2) ($)				Option Awards(3)(4) ($)				Non-Equity Incentive Plan Compensation ($)				All Other Compensation ($)				Total ($)
Mark Pruzanski, M.D. Chief Executive Officer and President			2016				620,000				420,000				2,196,957				1,608,449				—				4,627	(5)			4,850,033
			2015				600,000				420,000				2,255,185				2,841,753				—				4,627	(5)			6,121,565
			2014				537,500				327,250				1,249,981				1,108,935				—				4,444	(5)			3,228,110
David Shapiro, M.D. Chief Medical Officer and Executive Vice President, Development			2016				475,000				184,000				735,462				537,908				—				29,877	(6)			2,232,247
			2015				460,000				184,000				769,153				1,143,686				—				29,877	(6)			2,586,716
			2014				409,250				165,900				400,079				354,945				—				15,052	(6)			1,345,226
Sandip Kapadia Chief Financial Officer and Treasurer			2016				200,000				75,000	(7)			2,195,400	(8)			1,559,019				—				7,057	(9)			4,036,476
Rachel McMinn, Ph.D. Chief Strategy and Business Officer			2016				420,000				156,000				631,743				464,077				—				16,508	(10)			1,688,328
			2015				390,000				156,000	(11)			604,868				925,424			��	—				16,508	(10)			2,092,800
			2014				236,667				130,169	(11)			1,300,263	(12)			1,166,901				—				2,560	(10)			2,836,560
Lisa Bright(13) Chief Commercial and Corporate Affairs Officer			2016				367,280				135,680				780,215				537,908				—				111,854	(14)			1,932,937
			2015				396,000	(13)			158,400				776,620				1,174,242				—				140,421	(14)			2,645,683
Barbara Duncan Former Chief Financial Officer and Treasurer			2016				322,500				327,250				584,598				427,162				—				21,168	(15)			1,682,678
			2015				415,000				166,000				604,868				925,424				—				21,168	(15)			2,132,460
			2014				372,500				148,125				400,079				354,945				—				8,527	(15)			1,284,176

(1)

For 2016, 2015 and 2014, our named executive officers were granted a target-based bonus. The target-based bonuses were based on a target percentage of each named executive officer’s base salary for the fiscal year and then adjusted based on pre-determined corporate goals as well as on a subjective evaluation of individual performance, except for our chief executive officer whose annual bonus was determined solely based on attainment of our company objectives. See “Compensation Discussion and Analysis — Components of Our Executive Compensation Program — Annual target-based cash bonus” for the target achievement by each of our named executive officers. In 2015, the target-based bonus was based on the achievement of 100% of corporate goals, in the case of Dr. Pruzanski, and 100% of corporate goals and individual performance, in the case of our other named executive officers. In 2014, the target-based bonus was based on the achievement of 90% of corporate goals, in the case of Dr. Pruzanski, 90% of corporate goals and individual performance, in the case of our other named executive officers (prorated for Dr. McMinn).

(2)

The amounts in this column represent the aggregate grant date fair value of restricted stock units or restricted stock unit awards granted to the named executive officer computed in accordance with FASB ASC Topic 718. See Note 13 of the notes to our consolidated financial statements in our annual report on Form 10-K filed with the SEC on March 1, 2017 for a discussion of the assumptions used in determining the grant date fair values of equity awards. These amounts do not correspond to the actual value that will be recognized by the named executive officers.

(3)

The amounts in this column represent the aggregate grant date fair value of stock options granted to the named executive officer in the applicable fiscal year computed in accordance with FASB ASC Topic 718. See Note 13 of the notes to our consolidated financial statements in our annual report on Form 10-K filed with the SEC on March 1, 2017 for a discussion of the assumptions used in determining the grant date fair values of equity awards. These amounts do not correspond to the actual value that will be recognized by the named executive officers.